In just a few days, the value of BTC sank from $ 40,000 to $ 30,000, and then recovered to $ 38,000. But the impressive correction negatively affected the enthusiasm of traders, who are now interested in only one question: should we expect a collapse in BTC?
It should be noted that the latest corrective dynamics of the BTC / USD pair was not something strange and inexplicable. On the contrary, any trend dynamics in financial markets always represents a struggle between buyers and sellers, during which the initiative from time to time turns out to be on the side of both the “bears” and the “bulls”.
This statement is especially relevant in relation to BTC, which has shown phenomenal growth in recent weeks and updated its all-time high, and without any correction. In other words, a rollback in the BTC / USD pair has matured for a long time and could occur at any time.
An excellent illustration of the changing market sentiment is the Crypto Fear & Greed Index indicator, which shows how much Bitcoin is overvalued or undervalued at a particular point in time. The index characterizes the level of greed and fear for the BTC / USD pair that prevails in the market right now. As soon as the Crypto Fear & Greed Index was above 90 points, it became obvious that everyone believed in Bitcoin, or rather in its continuous growth. However, even the crypto market is designed in such a way that everyone cannot earn money on it at all times.
As soon as the index reached another extreme, the trend reversed. Explicit overbought has triggered a corrective pullback that could continue until market positioning reaches a new equilibrium state. As a rule, this happens at around 50-60 points. After the last sale, during which BTC temporarily fell to $ 30,000, the Crypto Fear & Greed Index value also corrected from 95 to 83 points. Based on this, it follows that the decline in BTC may continue and now is not the best time for new purchases.
Should we expect Bitcoin to rise in price to $ 50,000? Of course it is. Recall that the growth of the first cryptocurrency will be helped not only by a constant influx of new investments, but also by the absence of regulatory risks. Bitcoin is the only cryptocurrency that is not supported by any company, thus, it will not have such questions as, for example, XRP.
Right now, the popularity of bitcoin in Google trends is repeating the dynamics of the end of 2017 and is fueled by the news that large banks continue to enter bitcoin. Earlier on the market, there was news that Morgan Stanley bought 11% of the shares of MicroStrategy, which has already invested over $ 1 billion in bitcoin.
Considering the above, the growth of BTC will certainly continue, but at this stage there is a risk of another wave of sales up to $ 25,000.
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