Market Picture
Bitcoin’s
rally accelerated late Wednesday after hitting $29K but ran
into strong resistance as it approached $30K (the level passed on some
exchanges). The inability to break above this level triggered a massive wave of
capitulation. It quickly, but not for long, pushed the price back to $27K, the
price at the start of the week. By Thursday morning, buying prevailed again,
returning the price to $29K.
Despite the
wide intraday swings, the broader market picture is still very bullish as the
bulls have managed to push the price above the 50-day moving average, which is
pointing up from $27K on Monday to $27.4K. At the end of March, the market
bought Bitcoin near this level. In other words, we have strong indications that
the first cryptocurrency maintains its uptrend.
Financial
news is also helping the buying. The rally comes on the heels of reports of the
stock collapse of troubled First Republic Bank, which was bailed out in March.
Another bout of capital preservation fears has brought attention back to
crypto.
News Background
BitMEX
co-founder Arthur Hayes said that with the “broken banking system”,
investing in cryptocurrencies would help people protect themselves against the
risk of losing money. He says, “Those who believe in traditional finance
will inevitably suffer losses”.
Twitter
analyst TechDev believes Bitcoin is in the early stages of a parabolic rally as
the technical picture now resembles the bull market of 2015 when BTC went from
less than $200 to $20,000 in two years.
Cryptocurrencies
have evolved from “rebellious instruments” to a mainstream asset class,
according to the UK’s Financial Conduct Authority (FCA). However, the agency
expressed concern that organised crime could use crypto.
The CFTC
intends to go to Congress with a proposal to remove the anonymity of
crypto-assets and introduce digital identification of owners, said Commissioner
Christy Goldsmith Romero.
This article was written by FxPro’s Senior Market Analyst Alex
Kuptsikevich.
