5 things to watch for Bitcoin this week

Bitcoin (Bitcoin) Start the new week, the key weekly closing price and everything worth playing-can it stay higher?

After mild volatility over the weekend (including a retest of the USD 30,000 support level), BTC/USD returned to above USD 35,000.

Despite the negative news from China, FUD and the reorganization of miners, the latest BTC price trend shows that the largest cryptocurrency still has more power to fight.

Nevertheless, the risk of further decline still exists, and not everyone believes that the market has truly bottomed.

Cointelegraph will consider five factors when determining Bitcoin’s next move in the next few days.

Kiyosaki: Prepare for “the biggest collapse in history”

It is the stocks rather than the U.S. dollar that leads this week, as the S&P 500 index is the best week since February.

As concerns about the Fed’s interest rate hike have eased, the stock market rose last week. This is in stark contrast to the cooling dollar currency index (DXY), which has stopped rising in recent days after falling sharply last week.

Commentators believe that with the S&P 500 index hitting a record high, the risk of change still cannot be ignored.

David Bassanese, chief economist at BetaShares, an Australian fund provider, wrote in a report: “Due to the continued strong U.S. economic data, there is a risk that bond yields will rise – and the stock market may fall – The risk still exists.” lead Bloomberg.

At least so far, long-term bond yields are still under control, and the stock market pays more attention to the V-shaped rebound in economic growth and corporate profits.

1 day candlestick chart of the US dollar currency index. Source: TradingView

Despite the economic hardship caused by the coronavirus response, Bitcoin’s supporters have long predicted that one day will come amidst claims of rising stocks.

Chief among them is Robert Kiyosaki, the author of the best-selling book “Rich Dad and Poor Dad”, who reiterated his warning on the global market on Monday.

“The best time to prepare for the crash is before the crash. The biggest crash in world history is coming,” he tell Twitter fans.

The good news is that the best time to get rich is during the crash. The bad news is that the next crash will be a long one. Get as much gold, silver and Bitcoin as possible. Be careful.

Bitcoin seals the key weekly closing…

For the Bitcoin spot price, Sunday finally gave the bulls the happy ending they had been looking for.

This particularly concerns the weekly closing price, which, until Saturday, may still be below the critical level required to maintain further upside opportunities.

In this case, BTC/USD exceeded expectations, rising more than $2,000 in a few hours overnight, seeing a local high of $35,250 on Bitstamp, and a weekly closing price of more than $34,000.

Analyst Rekt Capital previously stated that this positions the currency pair correctly and is “very good for bull market momentum” Say Before the data comes in.

BTC/USD chart and weekly closing target.Source: Rekt Capital/Twitter

As Cointelegraph Report Therefore, on Sunday, Rekt Capital can continue to focus on the more positive Wyckoff scenario, which involves a potential local peak of around $40,000.

Another popular social media trader call The overnight rise was “significant” and concentrated at the resistance of $35,000, and the rise in the Bitcoin Relative Strength Index (RSI) to capture potential oversold (and overbought) levels.

Further gains will also correct to a certain extent the so-called “death cross” that occurred before—that is, the 50-day moving average crosses the 200-day moving average over a period of time. mobile This has caused widespread media attention.

…But it will be a record-breaking difficulty reduction

For those who cheered about Bitcoin’s biggest difficulty increase since 2014 six weeks ago, there is bad news.

As China’s mining industry is in trouble after the turmoil of its internet fundamentals, the difficulty adjustment this week will reveal how much the impact of recent events has been.

After four days, the difficulty will be Adjust down An estimated increase of 23.24%-this has never happened in Bitcoin’s lifetime.

The record downward adjustment is a response to the massive offline of Chinese miners, and it is a gift for some people, including those who have moved overseas.

Such adjustments maintain the competitiveness of Bitcoin mining while maintaining network security. Lower difficulty incentivizes more miners to join by making the process cheaper. This, in turn, will increase competition, which means that generally speaking, there will be growth after a larger recession.

“Mining power may drop significantly, but the difficulty will only be adjusted downwards, the network will clear the blocks, and the remaining miners will become more profitable, having to sell fewer coins, stimulating price increases, and encouraging More mining,” Saifedean Ammous, author “Bitcoin Standard,” to sum up In a series of tweets about current events last week.

Difficulty adjustment is the magic that makes Bitcoin work. This means that Bitcoin mining will grow and shrink to the scale needed to survive and maintain block cleanup.

7-day average chart of Bitcoin difficulty.Source: Blockchain

As Cointelegraph ReportComputing power-computing power dedicated to mining-has declined since the collapse of China, but how much depends largely on the estimates used.

according to Pool statisticsAs Blockstream CEO Adam Back’s preferred data, the hash rate is currently about 83 exahashes per second (EH/s), which is lower than the peak of 168 EH/s.

Global adoption drive continues

A magnified observation of the state of Bitcoin adoption provides some welcome relief to the apparently unstable spot market.

As Cointelegraph Report, El Salvador has passed its law to trigger a domino effect, making Bitcoin a legal tender, which went into effect in September.

Paraguay is the next country to submit a legal motion to the parliament. After the fiat currency bill is passed, the details have not yet been fully announced submit June 24.

Elsewhere, although Bitcoin’s status has not officially changed, recent events seem to have made supporters bolder.

According to Forbes rankings, Mexico’s third richest person, Ricardo Salinas Pliego, reiterated that Bitcoin is the “new gold” this weekend, revealing his contribution to local adoption.

Salinas confirmed on Twitter that his banking business Banco Azteca is merging BTC.

“Bitcoin is a great way to diversify investment portfolios, and I think any investor should start studying cryptocurrency and its future,” he said wrote.

At Banco Azteca, we are working hard to bring them to our customers and continue to promote freedom.

Everything is in an atmosphere of “extreme fear”

Even with a daily rise of 5%, the sentiment surrounding Bitcoin is still firmly driven by fear.

This is based on the classic emotional measurement standard, Crypto Fear and Greed Index, Despite the price increase, it was only 25/100 on Monday.

Fear and greed are careful indicators of how cautious a trader may be, falling to a rare low in the past month, only bottoming out at 9/100.

Crypto Fear and Greed Index. Source: Alternative.me

Although its score has almost tripled since then, market participants still feel “extremely fearful”-which means that it has enough potential to adapt to the sharp rise in prices.

On the other end of the spectrum, “extreme greed” often precedes price drops.