Bitcoin (BTC) opened the new week in green a few days later and over $ 50k. So what’s next?
Cointelegraph took a look at five factors that could affect Bitcoin price action in the coming days.
Bitcoin Price Index: How much is 1 Bitcoin in TL? (BTC TL)
The dollar has gone down
While the macro markets presented a picture mixed with hope and pain shaped around the coronavirus, the stock markets started this week calmly again.
yaşanmazken a major event in the Asian markets, viruses and economic problems in Turkey gained momentum in India is creating concern.
Preparing the US to send tourists to Europe this summer creates new economic incentives for investors.
On the other hand, Bitcoin has almost no tendency to monitor the macro situation.
The dollar, on the other hand, gives positive signals for Bitcoin. The US Dollar Index (DXY), which usually inversely correlates with bitcoin price and closed last week below 91 points, continues to decline.
BTC over $ 53k
The Bitcoin spot price movement started to surprise from the beginning of the week, and this time it was the bears who were caught unprepared.
According to data from Cointelegraph Markets Pro and Tradingview, the BTC / USD pair rose above $ 53K for the first time since it lost this level last week.
Since Bitcoin has reached a market value of $ 1 trillion at this level, $ 53,000 is important.
With BTC reaching $ 53,000, a short position worth $ 150 million was liquidated within one hour.
“Temporary sales seem to be over,” publisher Preston Pysh posted on Sunday night. he predicted.
A major setback in difficulty is expected
As for network basics, miners are trying to overcome the recent power outage in China that resulted in the network’s hash rate to crash overnight.
Due to the flooding, most of China’s mining power was disabled, and its hash rate dropped almost 25 percent from its all-time high.
As miners try to adapt to this situation, the reduction in mining difficulty will allow miners to operate more profitably and provide incentives to protect the security of the network.
This decline, which is expected to occur in five days, will be the biggest challenge since November 3, when the BTC / USD pair was traded at $ 13,000.
Fear prevails in the market
Along with short and highly leveraged long positions, the unreasonable market sentiment seems to have finally disappeared from the industry.
The Crypto Fear & Ambition Index, a popular indicator, uses a variety of factors to measure investor sentiment.
You may be interested in: What is the Crypto Fear & Ambition Index?
The index rose to 80/100 points when BTC rose to $ 65k, signaling that the sale was imminent.
The pointer of the indicator turned to “extreme fear” and then to “fear” with the decline to 47 thousand dollars, revealing that the market sentiment was reset.
Price drop could be a ray of hope
Individual investors are not the only ones who experience a serious change of emotion. According to the indicators, the unbalanced attitudes of professional investors were also effectively erased from the market.
In a market bulletin shared by Morgan Creek Digital Co-Founder Anthony Pompliano on Friday, analyst William Clemente said long positions are becoming attractive again.
“This fall may be a glimmer of hope, ambition and excess leverage have disappeared,” said Clemente.
“When the majority of investors take long positions, it becomes profitable to take short positions, and the opposite is true when short positions are predominant. With this decline, funding rates turned negative, that is, taking long positions became profitable again. In the current bull market this has happened twice before and both are buy signals. “