Bitcoin Price: 5 Things That Will Impact the Crypto Market This Week
April 20, 2020 @ 13:41 +03:00
From oil nearing $10 to stocks trading near all-time highs despite millions of unemployed, Bitcoin has a lot to consider this week. Bitcoin (BTC) maintained $7,000 despite strong resistance on April 20 as oil crashed through fresh support levels towards $10. Heading into what promises to be a choppy week for traditional markets, here are five things to watch for Bitcoin traders in the coming days.
Data from Coin360 and Cointelegraph Markets showed some rare calm for BTC/USD as the week began. The pair circled $7,190 at press time, having lingered inside a $300 corridor over the weekend. Bitcoin has now maintained $7,000 support since April 16, while analysts continue to warn that year-to-date resistance and the 200-day moving average both present barriers to further growth.
The last time such prices were recorded was in 1999, while a $10 price tag was rarely seen on market closes even then — since 1987, a close of $10.82 formed the record low, according to data from Macrotrends. As Cointelegraph reported, even United States President Donald Trump has appeared resigned to the idea of oil falling even as low as single digits per barrel. “No one wants oil right now,” Bloomberg summarized while tracking the decline on Monday.
Paradoxically, stock markets continue to gain, despite millions of unemployed workers still appearing and the U.S. and other governments supporting them with helicopter money. Commentator Holger Zschaepitz noted on Monday that a basket of stocks known as FANGMAN — Facebook, Amazon, Netflix, Alphabet, Microsoft, Apple, Nvidia — traded just 7% below its all-time highs as the week began. Since its crash in March, Bitcoin has shown a continued correlation with the fortunes of major stock markets. The increasingly bizarre contrast has formed the topic of intense scrutiny by Bitcoin supporters, however, with Max Keiser arguing that it represents the illicit transfer of wealth away from workers and companies to banks and the state.
Bitcoin’s third seminal block reward halving is now just three weeks away. Set to reduce the amount paid to miners per block to 6.25 BTC, the event will harden Bitcoin as money overnight.
In an interview on Sunday, Saifedean Ammous, author of the popular book “The Bitcoin Standard” made a simple argument for the halving’s positive impact on the Bitcoin price. Once the flow of new Bitcoins halves, he argued, demand could theoretically also halve and still keep BTC/USD at its current level.
PlanB, the analyst behind the celebrated stock-to-flow price model, meanwhile sticks by its latest forecast — by the end of 2020, Bitcoin should trade at around $30,000.
On Tuesday, Bitcoin’s difficulty adjustment feature means it will become 8.5% more difficult to find new blocks. This is one of the rare larger upticks after difficulty — and interpreted as a bullish sign by some analysts — adjusted downwards following last month’s price crash. As Cointelegraph often reports, difficulty plays a key role in ensuring Bitcoin remains hard money — price fluctuations do not result in coins being mined faster or slower, and the stock-to-flow ratio is thus preserved.
Bitcoin Price: 5 Things That Will Impact the Crypto Market This Week, CoinTelegraph, Apr 20