Supply and demand measurements determine the price of the asset, and data from Glassnode, the computer company in the chain, show that the liquid supply to Bitcoin (BTC) has declined since June 2020. This indicates that bitcoin traders do not sell assets.
While supply is shrinking, demand has increased in recent months as more institutional investors buy bitcoin.
Bloomberg recently reported that Cointerpoint Global, a subsidiary of Morgan Stanley Investment Management, “is looking at whether cryptocurrency will be a suitable option for investors.”
According to the Morgan Stanley website, Counterpoint Global prefers to invest in assets “whose market value can increase significantly for fundamental reasons.” This indicates that the bank believes that Bitcoin may be undervalued compared to the basics.
JPMorgan Chase also suggested that it may eventually offer bitcoin services. Daniel Pinto, co-chairman of JPMorgan, believes that if investors and asset managers start using bitcoins, the bank must “get involved”. However, Pinto said that the current demand is not high enough, but admitted that it may grow in the future.
Despite the fact that Bitcoin has risen sharply in recent months, its dominance has decreased from 69.71% on January 4 to 60.9% now. This indicates that altcoins have passed Bitcoin in recent weeks. If we look at altcoins, let’s examine the charts of the top five cryptocurrencies that may be trending in the next few days.
Bitcoin / USD
Bitcoin broke the resistance level of $ 41,959.63 on February 8 in a strong bullish move, but progress has been weak since then. Although the price is constantly rising, the leading cryptocurrency faces the problem of locking in profits at periodic levels.
If the price turns from current levels and falls below $ 46,000, the correction can be extended to strong support of $ 41,959.63. If the BTC / USD pair bounces off this support, it means that the bulls will continue to build up in the downturns, indicating that the uptrend has not been broken.
The bulls will then try to raise the price above the psychological barrier of $ 50,000 and resume the trend with the next goal of $ 60,974.43. On the other hand, if the bears push the price below the 20-day exponential moving average ($ 41,349), the pair may fall to the 50-day simple moving average ($ 36,070).
This is an important support to watch out for as the price has not fallen below the 50-day SMA since 9 October. Hence a break below which indicates a possible trend change. Next support on the back is much lower at $ 28,850.
The 4-hour diagram shows that the pair has formed a rising wedge pattern which is completed at the break and close below the guide line. If that happens, the pair could fall to $ 43720.85 and then to $ 41559.63.
Contrary to this assumption, if the price reverses from the current level or 20-EMA and rises above the wedge, it will invalidate the bearish setup. A break of over $ 50,000 can attract strong bearish short positions and can lead to a quick rally to $ 55,000.
BCH / USD
On February 12, Bitcoin Cash (BCH) broke the $ 539 resistance, which attracted bullish buyers. Altcoin gained momentum and rose above the resistance level of $ 631.71 on February 13th.
The long week in the light of day indicates that short-term traders can reap profits after the last rally. The BCH / USD could now correct to $ 631.71, and if the bulls were able to reverse this level of support, this would indicate purchases on every weak fall.
If the bulls manage to push the price above $ 730.02, the trend could reach $ 900. Both MAs are sloping upwards, and the Relative Strength Index (RSI) is in the overbought region, indicating a bullish advantage.
Contrary to this assumption, if the price falls and stabilizes below $ 631.71, the correction may be deeper to $ 539.
The 4-hour chart shows that the bears protect the resistance at $ 720 and the bulls buy on the fall to $ 650. If buyers manage to push the price above $ 730.02, the trend can resume.