Bitcoin (BTC) is keeping speculators bullish and bears guessing when it turns on a new weekly light in green, shifting away from $ 50,000.
After a quiet but boring weekend, BTC / USD on Monday started winning $ 53,000 for the first time since Thursday. What could be in the store?
The Cointelegraph looks at five factors that could influence BTC’s price movement over the next few days.
BTC / USD weekly chart (Bitstamp). Source: TradingView
Equities are stable, but the dollar is falling
Stocks are doing well again this week as the macro picture presents a familiar mixture of hope and suffering brought on by the coronavirus.
While the Asian markets were experiencing a busy day in general, the virus woes in India and the economic woes in Turkey were worrisome.
Additionally, with the US sending tourists to the European Union this summer, new economic incentives are starting to appear for traders.
However, without an overall trend, the driving force of Bitcoin, as it follows the aggregate storytelling, is seldom present – and today’s price action has already demonstrated that.
“What in the future?” Elon Musk, Tesla and SpaceX “Technoking” summed up the results on Saturday in a tweet that would interest many market participants. Tesla, a major investor in BTC, will report earnings after the Wall Street close.
Regarding the dollar, the possibility that Bitcoin is larger is more distorted – the US Dollar Currency Index (DXY) continues to decline after closing below 91 on Friday. As Cointelegraph often states, the index, especially in the past year, tends to correlate negatively with BTC / USD.
BTC returned the $ 53,000 mark
Bitcoin’s spot price dynamics do offer surprises, and unlike last week, they are inadvertently catching bears.
Data from Cointelegraph Markets Pro and TradingView shows that BTC / USD is rising to $ 53,000 for the first time since it lost the same level during the fall of last week.
The level itself matters and corresponds to the $ 1 trillion market capitalization of bitcoins, and thus was previously a line in the sand that analysts believed would hold.
In this case, the minimum has been given to $ 46,000, but it is not certain after the last drop in prices has ended. This is evident from trading positions as the $ 53,000 rally eliminated $ 150 million from short positions in one hour.
“It looks like this temporary sale may end,” podcast host Preston Beach said late Sunday night.
The size of the drop came as a shock to some investors, despite many new buyers entering the network. Settlements on the chain remain green overall, which adds weight to the theory that the current situation is a temporary downturn in the tough beef market.
“The market is very emotional when it’s over 2% +/- turnover on the rails,” said Philbfilb, co-founder of trading chain DecenTrader, who signed up for Telegram last week.
“Bear in mind that the twists are coming soon. I’m optimistic, but I think we need to turn things around a little bit before we start. Maybe I’m wrong … about the trend, but not much about the diversity of coverage at the time.”
The difficulty created the biggest track since November
Essentially, miners continue to recover from a power outage in China that brought the network fragmentation rate to a standstill at night in early April.
As a result of the flood, as was the case before in Bitcoin’s life, most of China’s mining capacity disappeared from the network, resulting in a low hash rate, which at one point approached 25% of its all-time high.
Since then, miners have begun to adjust, while reducing mining difficulty will allow smaller operators to mine more profitably and provide an incentive to keep the network safe.
The drop, which comes in five days, will be the biggest negative move since November 3, when BTC / USD was still at $ 13,000.
Average bitcoin hash rate over 7 days. Source: Blockchain.com
Difficulty adjusting is an important, if not the most important, part of Bitcoin’s ability to maintain itself regardless of external factors affecting its modus operandi.
The past few months have been marked by increasing difficulties which, along with frequent hashs, have resulted in the emergence of new full-time regular spots. If history continues to repeat itself, price action should also return to the upside in line with the recovery.
Blockstream CEO Adam Buck warned observers of their choice of statistics and said the drop was not as large as some have suggested.
Bitcoin’s hash rate is back at 157 EH, which is about 5% below the peak of 168 EH. It’s basically down 25% to 125 EH, “he wrote Sunday.