Over the weekend, Bitcoin collapsed again. In principle, this behavior of the world's main cryptocurrency has already been observed quite often. The decline usually occurs on Sunday or Monday night. Therefore, the corrective scenario currently remains in force, since Bitcoin has not managed to develop a new upward movement and return to the level of $ 51,350. Instead, a new downward trend line has formed, and the quotes fell below the Ichimoku cloud again and are around the support level of $ 43,852, from which a rebound has already occurred twice in recent weeks. In this case, the cryptocurrency can test this level for the third time today or tomorrow and its further prospects entirely depend on breaking through it or not.
It is worth noting that the results of the Fed's next meeting will be summed up this Wednesday. This meeting may be very important, as the regulator may decide to wind down the quantitative stimulus program at it. From our point of view, part of the funds that the Fed pours into the American economy also settles on the cryptocurrency market. Accordingly, it can be assumed that Bitcoin's growth in the last year and a half is also partly due to the actions of the Fed, which it may severely limit in the coming months. It can also be recalled that the "bullish" trend could end near the level of $ 64,756, and all the movements that were seen after that could be consolidated. Bitcoin can consolidate for a year or two before starting a new "bullish" trend. Despite the growth of its quotes in the last few months, it is still impossible to conclude unequivocally that the upward trend has been restored.
It should also be borne in mind that the fundamental background for Bitcoin remains very weak. We have already questioned the validity of the last round of cryptocurrency growth by more than $20,000. From our point of view, there were no concrete and compelling reasons for such a movement. Any assumption requires technical confirmation. A new "infrastructure" package may be adopted in the States in the near future, within the framework of which the tax legislation will also be updated, which will oblige the collection of all personal information for all transactions over $10,000. The US authorities also want to replenish the budget by $ 29 billion by levying taxes on cryptocurrency transactions. However, there is no news that could support BTC right now.
As usual, the market is full of forecasts like "$ 100,000 by the end of the year" or "$ 500,000 in the next 5 years", but it can be recalled that such forecasts are given by those people who are personally interested in the growth of the Bitcoin rate. A striking example is the CEO of Microstrategy or the head of ARK Invest, who regularly notify the markets about the imminent growth of the cryptocurrency. Naturally, if Microstrategy has invested several billion dollars in the main cryptocurrency, it needs it to continue growing. However, it can grow only if the market believes in this very growth.
The downward trend is cleary shown in the four-hour time frame. It was unlikely to continue the movement to the level of $ 51,350, so a decline to $ 43,852 level is now expected. Earlier, the bears failed to break through the important level of $ 43,852 twice. Therefore, the third rebound from this level may provoke growth again and even consolidation above the downward trend line. Technically, it is possible to buy Bitcoin with a rebound from $ 43,852, while sales can be considered after consolidating below this level.The material has been provided by InstaForex Company - www.instaforex.com