Bitcoin Stood Still in Anticipation of Halving

Since August 10, BTC has been squeezed in a narrow range of around $11,400 and so far it experiences difficulties with determining the further direction. The current price dynamics are taking place against the background of the decline in trading volumes: according to CMC, over the last 7 days they have fallen by 42%. This may indicate a temporary loss of interest of investors, who prefer to stay aside waiting for new impulses.
Alexander Kuptsikevich

Later on, Bitcoin has several development scenarios. The optimistic one, with higher lows and higher highs, suggests that the current situation may be as it was in September-October 2017, when the cryptocurrency for some time rolled back before spiking to a historical high around $20,000. The launch of delivery BTC futures, with a new round of escalation of the trading war, stock collapse or tightening of the geopolitical situation, can create conditions for such an impulse of growth of Bitcoin, which will resist sharp take profits by large investors.

The pessimistic scenario suggests that the bullish impulse has already run out. Regulators are consistently postponing the consideration of applications for the launch of various Bitcoin investment instruments. Large capital and scalpers prevent bullish impulse from developing into a full-fledged rally, fixing profit after relatively small (by Bitcoin standards) price hikes. Crypto-enthusiasts and retail investors are finally losing leverage on price dynamics due to the presence of major players in the market. Such a long tug-of-war has a negative impact on sentiment and runs the risk of turning into a decline in BTC.

The neutral scenario implies that Bitcoin will be caught in the range of $9-$13K for a long time. As we approach halving in May 2020, market participants will start pushing up the benchmark cryptocurrency, as was the case with Litecoin (LTC): that soared by 370% before halving. In the case of Bitcoin, the growth amplitude may be much weaker, as the starting price point of the “halving rally” may not be as low as it was in the case of Litecoin.

Meantime, the traditional global financial system is moving into a very worrying direction. In addition to increasing technical and trade isolation, central banks want to get full control over the flow of funds within the country and are particularly interested in foreign transactions. In this case, the emergence of “national cryptocurrencies” and the conversion of all settlements into the non-cash form will be a natural step in the evolution of the monetary system. China will be a pioneer in this area, as the country is approaching the launch of its first “state cryptocurrency”. As with all other technical innovations, the country has banned all foreigners and is developing its own “autocratic analogue”.

As sad as it may be to admit, the emergence of Bitcoin and “Satoshi’s vision” of financial interaction without intermediaries may lead to the exact opposite result: it is the cryptocurrencies that will deprive people of any anonymity in spending and give governments unlimited monetary power.

This article was written by FxPro

Don't miss a thing!

Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All

Top Promotions

Top Brokers

IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US