5 factors Bitcoin investors should watch this week

Bitcoin (BTC) started the new week very close to record price levels. So will he be able to hold on to this level?

Cointelegraph took a look at five factors that could affect Bitcoin price action in the coming days.

Unexpected growth from China

Macro markets are giving different signals as the new week begins.

While bond yields have been a strain for futures in the US, China reported an incredible growth in the first months of 2021 in Asia.

Bitcoin Price Index: How much is 1 Bitcoin in TL? (BTC TL)

Both industrial output and retail sales of China increased 35 percent and 33.8 percent, respectively, exceeding the 32 percent target.

However, liquidity concerns, including the People’s Bank of China (PBoC), continue to keep the markets in check.

Australia & New Zealand Banking Group Economist Xing Zhaopeng told Bloomberg that “PBoC has withdrawn 600 billion yuan from the market since the beginning of this year to prevent the inflation in asset prices.”

The US Federal Reserve is expected to increase the interest rate due to its intense money-printing activities.

USA started distributing stimulus checks

For US investors, a macro problem dominates the short term: incentive checks.

Under the US President Joe Biden’s $ 1.9 trillion incentive plan, the distribution of $ 1,400 checks started.

The new stimulus plan is expected to add a new debt to the US $ 28 trillion debt and increase inflation despite all contrary statements by the Fed.

Fed balance sheet chart. Source: Federal Reserve

Bitcoin supporters wonder how much of this money will enter the cryptocurrency ecosystem.

Rich Dad Poor Dad “Millions are delighted with the $ 1.9 trillion incentive law,” said Robert Kiyosaki, author of the bestselling book. Who wouldn’t be happy with free money? ” he stated and added.

“The problem is that free money creates the poor and makes the middle class poorer. Buy more gold, silver and Bitcoin. “

Although these incentive checks have been in the wallets of the US people since March 14, they must be waited until at least Wednesday before spending can be made.

Last year, there was an increase in BTC purchases made on Coinbase exactly in the amount of incentive checks. This time, Bitcoin attracts much more attention compared to last year.

Whales increase the pressure

In the case of Bitcoin, Monday is a tough day for investors.

Bitcoin, which reached $ 61,700 over the weekend, failed to maintain this momentum and fell below $ 60,000 by the start of the week.

1-hour candlestick chart (Bitstamp) of the BTC / USD pair. Source: Tradingview

BTC fell as low as $ 55,500 as of the time of translation broadcast.

Binance’s order book data showed that there was support at $ 57,000, and if it fell below this level, $ 50,000 could be seen.

Binance buy and sell levels as of March 15, 2021. Source: Material Indicators

There may be familiar reasons behind this gradually accelerating decline. On-chain analytics service CryptoQuant data revealed that stock market reserves rose to their highest this month.

According to the data, Gemini witnessed a significant amount of BTC inflows. This shows that professional investors such as whales are turning to selling.

Bitcoin reserves and BTC / USD chart of the exchanges. Source: CryptoQuant / Tradingview

Cryptocurrencies change hands

Looking at the larger time frame, it is seen that a large amount of Bitcoin was removed from the market during the weekend.

Especially on Sunday, investors were unaffected by the record price and moved large amounts of their savings to cold storage, according to Glassnode data.

Bitcoin’s liquid supply change and the BTC / USD chart. Source: Glassnode

Looking at a much larger time frame, although the number of Bitcoins transferred to exchanges in the short term increases, the liquid Bitcoin supply is much lower than it was only six months ago. Coinbase’s BTC reserve, for example, measured almost 20 percent lower than in December.

Coinbase’s BTC reserve chart. Source: Glassnode

Tough journey for 70 thousand dollars

The stock market funding rates also showed the highest jump seen since February 23.

Bitcoin funding rates chart. Source: Bybt

Cointelegraph analyst filbfilb said last week that the funding rate differences across trading platforms prevented BTC from showing a bigger rise.

Filbfilb is still targeting $ 70,000 for Bitcoin in the longer time frame, saying that this level is the “destiny” of BTC.

On the other hand, the analyst thinks that this rise will be a more challenging journey, not a vertical one, similar to the effect Tesla did when he announced his BTC purchase.

Check Also

Bitcoin futures market mimics last year’s end

The new data shows that the open interest of the Bitcoin (BTC) futures market mimics …

Leave a Reply

Your email address will not be published. Required fields are marked *