- Bitcoin corrected higher and brushed shoulders with $6,800 before consolidating gains above $6,600.
- Drought-stricken Argentina contributes significantly to the rising Bitcoin volumes.
Bitcoin made an incredible bounce last week from the ashes slightly above $6,100. While the spike was mainly driven by Ripple (XRP) surging volumes and market capitalization, Bitcoin has been able to remain stable above $6,600. However, preceding the weekend consolidation, BTC/USD approached $6,800. The buyers could not support further movement towards $6,900 and the largest crypto by market capitalization began correcting lower.
It has been reported that Bitcoin sales are flying high in Argentina. The demand for the digital asset is leading to the increasing volume and bullish trend that commenced towards the end of last week. Bitcoin is gladly enjoying the boost after dropping several times in the same month canceling the accrued gains. Argentina’s economy is in jeopardy following the drought that has hit the nation. In addition to that, interest rates that keep rising in the U.S. are adding more sorrow to an already gloomy situation. The direct effect on the local currency, Peso is depreciation while the economy continues to dwindle due to the dying agricultural sector which makes up at least 10% of the country’s GDP.
Significantly, the citizens of Argentina have decided to hedge their losses by shifting to the King of the virtual currencies, Bitcoin. They find Bitcoin to have better stability than the Peso. In return, Bitcoin volumes have been rising in the country over the last several months. The central bank in the nation is also considering putting part of its reserves in Bitcoin.
The above support could have a positive impact on Bitcoin which is trading at $6,670 at the time of press. In the wake of last week’s surge, the buyers consolidated their gains above $6,600 preventing any dips towards $6,500. There is an upward trend supported by the hourly 100SMA currently at $6,635.2. On the flip side, the 50SMA is capping intraday gains at $6,700. Bitcoin is likely to break the immediate resistance and retrace further towards $6,800. A break above this level could see the crypto attack $6,900 and eventually brush shoulders with $7,000.
BTC/USD 1-hour chart
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