Bitcoin (BTC) Finds Steady Support Above $5,000, Is it Time to Go Long?
The spread of the Coronavirus in Europe, N. America and the Asia Pacific region, has had a disatrous effects on the traditional markets as well as the crypto markets.
Bitcoin (BTC) had been on a slow tumble in February before its major dip in March.
Between the 12th and 13th of this month, BTC fell from $7,300 to $3,700 on some exchanges.
It has since found some support above $5,000 and is currently trading at $5,370 at the time of writing this.
It might be a while before it is safe to go long on the King of Crypto.
The past week has been a tumultuous one for Bitcoin (BTC) and the entire crypto market. The King of Crypto got a serious knockdown on the 12th and 13th of this month. BTC fell by 49% in value from $7,300 to $3,700 in a matter of a few hours. Some crypto exchanges, such as Bitmex, saw it dip to as low as $3,561. All its woes in the crypto markets have been brought about by the global economic effects of the Coronavirus. Some traders have even gone as far as to state that Technical Analysis no longer works with Bitcoin suggesting that only positive news about the Coronavirus will provide relief to both the stock and crypto markets.
Brief Technical Analysis of Bitcoin (BTC)
Further checking Tradingview, we find that Bitcoin has currently found a footing above the crucial $5,000 support level. It is currently ranging between $4,750 and $5,600 and is valued at $5,370 at the time of writing this. However, the 50 (white) and 100 (yellow) daily moving averages indicate that it is still in bear territory. If this environment prevails over the weekend and into the new week, it might retest its recent low of $3,700. Hopefully, this area will hold as major governments such as the United States, Italy and France, announce measures to combat the spread of the Coronavirus pandemic.
Sentiment Analysis of Bitcoin (BTC)
Further checking the crypto fear and greed index, we find that it is extremely low at a value of 8. The last time it was this low, was February 6th 2018. Checking the charts again, Bitcoin experienced a dip to $5,900 on this date and would then go on a two-week push up to reach a value of $11,800 on the 20th of February, 2018.
Best to Wait Till There is More Positive News About the Coronavirus
However, when we compare February 2018 to the current global economic environment witnessed this March 2020, we can conclude that times are extremely different. The world as we know it is coping with the global pandemic of the Coronavirus and global economies are in turmoil. It might be best to wait for good news with respect to winning the war against the global pandemic.
On the bright side, yesterday’s speech by President Donald Trump declaring the Coronavirus a national emergency brought back some confidence in the stock market as well as in crypto. In the speech, he outlined measures his government will undertake to control the spread of the virus in the United States. As a result, the Dow jumped a good $2,000 and Bitcoin has since maintained its value above the crucial support zone above $5,000.
Disclaimer: This article is not meant to give financial advice. Any additional opinion herein is purely the author’s and does not represent the opinion of EWN or any of its other writers. Please carry out your own research before investing in any of the numerous cryptocurrencies available. Thank you.