Bitcoin continues to convince market participants of the prospects for continued growth. Over the past 24 hours, the coin has added 3.9% and is trading around $57,250. Over the last seven days, Bitcoin grew by more than 18%. It seems that now the market is trying to brainwash the idea of starting a new stage of advancement, which will lead BTC to the next historical maximum with a probable culmination of growth by the end of 2021. Within this case, there is an attempt to draw analogies with the end of 2017. The only difference is that $20K has now become a bottom, desired by many bears and those willing to buy the asset at an acceptable price.
The upside idea is now fuelled by the news factor of pending SEC approval of a Bitcoin-ETF in the US. This is a long-standing and highly coveted factor, which can positively affect sentiment and may well push for profit taking if crypto market participants clearly see that the regulator continues to delay the launch of this instrument.
Bitcoin’s dominance index is showing gradual growth and is now at 45.8%, reflecting the propensity of market participants to invest in the market leader. In such bullish cycles, Bitcoin is often almost the sole beneficiary of financial flows. At the same time, alternative cryptocurrencies attract increased demand when the next phase of the rally ends, after which a broad correction can begin.
Nevertheless, there are news factors in the context of altcoins as well. For example, it became known that the major movie theatre chain AMC is starting to accept Dogecoin as payment for tickets. Indeed, this is another way to attract attention to movie theatres at the expense of crypto hype. Hardly anyone will actively use this method of payment. However, everyone wins in the end, as the DOGE coin got its price momentum and showed growth again.
At the same time, the US Senate voted for a temporary increase of the national debt limit, which is positive for the stock market’s sentiment. Since Bitcoin now actively correlates with what is happening in the traditional financial market, it is reasonable to expect that the coin, at least, will not face sell-off pressure from big money. Bitcoin’s near-term prospects, and subsequently the entire crypto market, will depend on how successfully market Influencers manage to “sell the idea” of starting a broad and large-scale growth of the crypto market.
We don’t see any significant fundamentals right now, and of course, in many ways, the market is again facing manipulation, and buying Bitcoin at these price levels is a perilous decision. We can say with relative certainty that by the end of 2021, we will see new ups and downs in the crypto market, with the rich getting richer and the poor getting poorer.
The FxPro Analyst Team
This Review is presented by FxPro.
For all Articles related to Fxpro please click here