Bitcoin (BTC) price enters the new week, with a little distance left to reach an all-time high.
After overcoming the weekend in a relatively positive way, the price remained higher without experiencing a deeper price drop than last week. $ 50,000 worked as a net support. What’s next for Bitcoin now?
Cointelegraph discussed five factors that could shape the Bitcoin price action in the coming days.
Stocks took positions for the crisis
The level of fear in the market had increased with the impact of a $ 20 billion block transaction Friday. An unusual opening is likely for US stocks on Monday. Major players Goldman Sachs and Morgan Stanley gave traders a headache with their orders over technology shares. This will end when the market opens on Wall Street on Monday.
“Traders all over the world know the issue and will stick to the screen,” portfolio manager Sharif Farha told Bloomberg. The fluctuation in stocks means a knock-on effect for Bitcoin, but it is unclear in which direction this will take place.
“Markets can start trading amicably early in the week,” said Andreas Lipkow, a strategist at the German bank Comdirect.
“Although there are huge profitable and unusual block trading activities, these asymmetrical movements in the market can still be used positively.”
Oil prices falling among other macro factors is taking placeHowever, this still does not put pressure on BTC investors as much as stocks. With the solution of the crisis in the Suez Canal, the Opec + meeting to be held this week could pull prices down as the expectations for an increase in supply rise.
BTC price consolidates at $ 56,000
It started with consolidation on Monday for the bitcoin spot markets. On Saturdays and Sundays, the support of BTC / USD pair at $ 50,000 has relieved traders.
When the deeper declines were not seen, the liquidation, which was feared to occur at $ 46,000, did not occur, and then the move towards the resistance at $ 56,000. At the time of the news release, Bitcoin was at the resistance point and the move to the highest level of $ 61,700 has not yet come.
Cointelegraph Markets analyst Michaël van de Poppe said on Sunday that in evaluation“As seen many times in the Bitcoin bullish scenario, key resistances cannot be broken all at once. Still, this is not a bad situation,” he said.
“If the $ 54,000 support is not held, I assume we will see another scenario similar to that. Consolidation continues.”
When describing the movement towards an all-time high, analysts point out that traders step aside and follow the “wait and see” method. They claim that the consequences of the shortage of supply caused by the emptying of reserves in the stock markets and the failure of large investors to sell are not yet felt.
April earnings are dependent on consumer spending
According to on-chain analysis resource Glassnode, performance in April will depend on individual investors rather than institutional investors.
Glassnode highlighted the unusual disparity between US consumer spending and disposable income stemming from the Corona virus bans in its latest study, published last week.
With the onset of the prohibitions, which should normally be strictly adhered to, the purchasing power of individual investors has been seen to operate independently. It was emphasized that there is no place to spend, even though there is more money thanks to the incentive payments made in the USA.
Nowadays, as the bans are being gradually reduced, pent-up consumer demand is expected to stabilize again.
“Many households now have extra money to spend due to reduced spending during new incentives and bans,” co-founders Yann Allemann and Jan Happel said. said.
“Will they invest this money in the markets or pay a loan? Bitcoin’s April performance will depend on it.”
The blog post that accompanies this view argues that the latest $ 1,400 incentives are not yet included in the economy.
“The last stimulus package was much larger than it was in January, but this has had little impact on global markets,” Glassnode said.
“It is difficult to measure the extent to which the checks have reached households so far. More importantly, considering that for a while this was the last financial incentive, it is quite difficult to measure how much the individual investor will willingly spend or save money this time.”
By the way, unverified reportsindicates that the next incentive checks may arrive earlier than expected.
The relative strength index says Bitcoin will gain more
Bitcoin technical indicators point to strong bullishness over long time frames. Traditionally, higher prices are seen when the relative strength index (RSI) reaches its peak.
Quant analyst PlanB, the developer of the stock flow Bitcoin price model, revealed how the relative strength index fluctuates according to Bitcoin’s halving cycles.
He said that normally the most efficient period in terms of price is the year after the halving. He stated that 2021 will not be different from 2013 or 2017.
“Bitcoin monthly RSI is not even 95. We spent at least 3 months above 95 in the bull markets of 2011, 2013 and 2017. It’s still early” used the expression.
Meanwhile, the stock flow model predicts an average price of $ 100,000 to $ 288,000 for the BTC / USD pair in the current half-cycle.
Fear and ambition index is calm
According to the Crypto Fear and Ambition Index, which is a classic metric of the market, the price increase at the weekend has a significant effect on selling pressure in terms of investor sentiment.
The Crypto Fear and Ambition Index, which gives a result between 0 and 100, shows how the market feels about Bitcoin price movements and determines whether the last activity was a jump from lows or a sell from high.
During the move towards an all-time high of $ 58,300 in February, the index gave warning signals for the BTC / USD parity. The index, which went up to 94, fell to 38 on 1 March. However, it was able to return to the 70’s after days.
At the time of writing this article, the index, with 72 points, pointed to a sense of “ambition” among investors. However, he says that there is still a distance before entering the sales area and that the “excessive greed” area has not yet been reached.