The leading cryptocurrency has proven its perseverance through years of tough market fluctuations, and the year 2020 was no exception.
Bitcoin Price Analysis – A strong start of the year 2020
Bitcoin opened the year with a price of approximately USD 7,160 and was on a perfect uptrend. News of advancements in technologies, and adoption of the blockchain protocol in public and private companies worldwide helped convey this technology to the mass crowds.
The impact of COVID-19
When the COVID-19 lockdowns were announced, markets around the world started to collapse, starting with the US stock market. All other markets around the world followed the sharp decline in prices, and the cryptocurrency market was no exception.
Correlation with legacy markets
Crypto enthusiasts used to hedge their legacy holdings by owning Bitcoins. But that’s not the case anymore, as correlations in trends are occurring between the US stock market and the Cryptocurrency market.
The proof? Well, the COVID-19 crash is the perfect example among many other occurrences. Both the stock and crypto markets fell sharply and recovered rapidly.
Bitcoin Price Analysis – Where are we today?
The price of Bitcoin is in a sideways market, defined by a very strong support and resistance area. Those key blue lines are delimited by a resistance price of USD 12,500 and a support price of USD 10,000 which were key areas ever since 2018, when we witnessed the rise and the fall of the cryptocurrency market.
Bitcoin Price Analysis – What should you do NOW as a Trader or Investor?
Traders or investors of any type of cryptocurrency should be on the daily lookout for what happens to the price of Bitcoin, as one of the two scenarios should happen:
- The price breaks through the USD 12,500 limits strongly, and the price will continue with a strong uptrend to reach the second resistance level of USD 14,000
- The price strongly dips below the USD 10,000 limit and we’ll have a short term bear market
It is indeed a very crucial moment not only for Bitcoin, but for ALL the other Altcoins as well. Bitcoin dominance today is around 60%. This means that the Bitcoin market cap makes up 60% of all the cryptocurrency market. That’s why any major move in the Bitcoin price can take other altcoins to new highs or new lows.
The current volatility for the top 10 cryptocurrencies is very low, registering price movements lower than 0.5% since yesterday. Bitcoin was seen slightly higher, trading above $11,400 at the time of writing. This “Low volatility” phenomenon usually signals either a slow but steady uptrend, or an upcoming strong downtrend. It is often a sign of buyers being wary of a high price, and proceeding with their trading with cautiousness.
Weekly lookouts for Altcoins that are most affected by BTC:
- Litecoin (LTC)
- Bitcoin Cash (BCH)
- Bitcoin SV (BSV)
- Ether (ETH)
- Dash (DASH)
- Monero (XMR)
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