With bitcoin falling below $ 40,000 in the middle of this week, market conditions now look strangely calm. Economic factors and the state of other financial markets may still make bitcoin more volatile, but technical indicators show that the decline is unlikely to last long.
With global oil prices again above $ 100 and investors’ fears in traditional financial markets of rising inflation, bitcoin has managed to stay close to $ 40,000 since yesterday, according to Quin Desk.
The start of trading on Tuesday in the US stock market was accompanied by the announcement of inflation last month, which showed that inflation in this country rose by 8.5 percent in March. This is the highest monthly inflation in the United States in four decades.
Data from March eased analysts’ fears that prices could fluctuate excessively and spiral out of control, and stock market prices rose for some time. Some analysts suggest that inflation may have peaked this month and will no longer be higher. At the end of the day, however, the rise in oil prices again suppressed investor optimism, and as a result, the share prices of some institutions fell.
The sell-off in the middle of the week was somewhat surprising, as prices fell for two consecutive days, falling below $ 40,000 for the first time since mid-March. Bitcoin is considered by many investors to be an anti-inflationary asset, but recent price fluctuations are largely related to the US stock market and this correlation is growing.
Edward Moya, a senior analyst at Oanda Brokerage, said:
Large organizations began making money and investing in the digital currency market in 2021, buying bitcoins when the price was somewhere between $ 30,000 and $ 40,000. This means that if they are still optimistic about the future of bitcoin, they will buy more units at that threshold.
Damanic Dantes, an analyst at the Quin Desk website, said that given the collapse of bitcoin in the middle of this week, market conditions now seem strangely calm.
In addition, some investors are monitoring the situation in China, where the re-emergence of the coronavirus has led to the resumption of quarantine in parts of the country. This could have a negative impact on global economic conditions.
Yesterday, Shiba Ino had the best performance among all major currencies on the market and after Robinhood started trading, the price of this memquin increased by about 35%. Meanwhile, Shiba Ino owners have been waiting a long time for this token to be added to Robin Hood’s market.
The price of bitcoin returned above $ 40,000 yesterday, indicating that some traders have used short-term market saturation as an opportunity to buy. Bitcoin may continue to fluctuate further between $ 37,500 support and $ 47,000 resistance.
The bitcoin market has declined by 12% in the last 7 days and some technical indicators suggest that this downward correction may stabilize over the next few days.
The Relative Strength Index (RSI) in the 1-day market view is close to the sales saturation zone, which may be a sign of greater activity of buyers in the coming hours. In addition, the 1-week market outlook shows signs of an uptrend, which increases the likelihood that this downtrend will be short.
The main resistance to the price will be the level of $ 50,966, which again may prevent the price from jumping to higher levels.
The publication Market Situation: The fall of bitcoin is unlikely to last long appeared for the first time in digital currency.