The expectation with Bitcoin: seek balance and forecast bullish cycle

Expectation with Bitcoin

Bitcoin tried all last week to return to the $40,000 line, although it even fell to 34,000. In the early hours of this Monday, it began with a price of $36,500. The rise propels other cryptocurrencies higher. 

After several days of uncertainty and falls, Bitcoin stabilizes in a wide range that goes from 34,000 to 38,000 dollars, and several analysts agree that from one moment to another there will be a new upward cycle, of that and other cryptocurrencies.

Bitcoin tried all last week to return to the $40,000 line, although it even fell to 34,000. In the early hours of this Monday, it began with a price of $36,500. The rise propels other cryptocurrencies higher.

Although it failed to regain the $40,000 that now offers strong resistance, bitcoin’s slight recovery poses a hopeful scenario after a week with the largest effective losses in the history of the cryptocurrency market.

Analysts are optimistic despite losses in recent weeks. According to Willy Woo, there are indicators that point to a market recovery, as reported by CriptoNoticias at the beginning of the week. Previously, the researcher had warned that this recovery would be slow and could take months.

In his recent posts via Twitter, Woo shared data from Glassnode on network behavior, arguing that the increase in active users on the network is a sign of BTC purchases amid the decline.

According to the most recent report from Glassnode, despite the price drop, a vast majority of Bitcoin addresses are holding onto profits. In total, 76% of the coins distributed on the network are above the price they were the last time they moved from one direction to another, which is considered a direction in profit.

“We do not know what the value of bitcoin will be tomorrow, in a week or in a month. But what we do know is that there is a macro trend that generates more and more money for bitcoin.” This quote belongs to the analysis firm Ecoinometrics, according to which bitcoin remains in the bull cycle despite the recent price drop.

According to the researchers, the cryptocurrency maintains a pattern that has been repeating after each halving of rewards for mining, the event known as halving that occurs approximately every 4 years.

On the skeptical side, Bank of Japan head Haruhiko Kuroda joined the list of central bankers who expressed doubts about the usefulness of cryptocurrencies in the real world.

“Most of the trade is speculative and volatility is extraordinarily high. It is hardly used as a means of payment,” Kuroda said of Bitcoin in almost coincidental statements with his peers at other central banks around the world, Bloomberg noted.

The president of the United States Federal Reserve, Jerome Powell, had said a month ago that cryptocurrencies are simply vehicles for speculation, and similarly the vice president of the European Central Bank, Luis de Guindos, said that tokens should not be considered real investments.

“Looking at the unrest in the cryptocurrency market, there is a chance that we will see another bumpy weekend in trading Bitcoin and other cryptocurrencies,” said Ipek Ozkardeskaya, senior analyst at Swissquote.

Why Bitcoin and other cryptocurrencies fell

The losses of the last days responded to the warning by China, which assured that it seeks to prevent financial risks and targeted bitcoin.

In a statement, the Asian country expressed its intention to use tools to regulate the cryptoactive, which in the week was repeatedly below US $31,000.

The message from China came after the United States announced its progress in regulation and will request that operations that exceed US $10,000 be reported to the treasury.

The measure will also be implemented for the rest of the cryptocurrencies in order to strengthen tax compliance in the country.

Cryptocurrencies trade with marked volatility and this led to bitcoin losing 25% on Wednesday, although it was finally able to moderate the fall to 7%.

The price reflects the comings and goings of investors, both institutional and those looking for an opportunity to “make a difference”, to the rhythm of the statements of the magnate Elon Musk , who made both the price of the cryptocurrency go up and down.

The cryptocurrency surpassed US $65,000 on February 8, when Musk announced a massive purchase with corporate funds, but in recent days it has suffered a sharp decline due to the change of opinion of the main Tesla shareholder when it was warned that it was not would accept tokens for the sale of electric cars.

In addition to Musk’s statements, the People’s Bank of China argued that digital tokens cannot be used as a form of payment, which also contributed to the drop.

Consequently, from February to the present, the bitcoin market, which reached more than a trillion dollars, experiences a loss that at the moment reaches US $500,000 million.