Summary:
- Bitcoin prices had an impressive run from late 2020 to early this year before the March crash. Here's a big picture perspective of Bitcoin's price.
Bitcoin prices had an impressive run from late 2020 to early this year before the March crash. So while many are wondering what comes next for the leading cryptocurrency, let’s analyse its positives and negatives from a big picture perspective.
Bitcoin Price Positives
- A digital lockdown induced by the COVID-19 pandemic has led to a broader acceptance of all things digital. The globe has been exposed to digital meetings and digital work, so the idea of a digital currency is conceptually easier to understand.
- There is greater acceptance of digital currencies by central banks. The fact that the ECB recently announced that they are considering what it would be like to have a digital euro is a reminder of the growing acceptance of digital currencies.
- El Salvador, which embraced Bitcoin as legal tender, is a nation with a 70% cash economy, so cash is generally king. However, villagers and farmers are now using Bitcoin to send small amounts to buy fruits and vegetables. The more this happens across the globe, the better news this is for Bitcoin prices.
- Whales (those holding between 1k-10K Bitcoins) have started accumulating their positions again after reducing them between March and May this year when BTC was trading in the $60,000 area.
Bitcoin Price Negatives
- The amount of energy to mine BTC is a significant negative. Environmental concerns are growing, and the amount of power used to mine BTC is a massive negative.
- Volatility. Who wants to adopt a form of exchange that moves up and down in double-digit percentages regularly? Volatility is a big turn off to anyone who isn’t speculative by nature
- Regulation. BTC is a buzzword associated with scam artists, fly by nights, and lures desperate people. So, governments are increasing the regulation of cryptocurrencies out of concern for their citizens. The fewer opportunities people have to access and use BTC, the less chance it has of sticking for the long haul.
The Opportunity
Finally, Bitcoin trades in a balanced market in many ways, However, accumulation looks to be in place (see point above). So the place to buy for a low-risk entry and high-reward position would be as follows:
- Entry: $20,000
- Stop: $15,000
- TP: At your discretion
Bitcoin price weekly chart
