- Bitcoin breaks free from a tight range and settles above $8,000.
- The cryptocurrency market is driven by positive sentiments despite mixed fundamentals.
- The long-term Bitcoin’s bullish trend is gaining traction.
The cryptocurrency universe staged a good recovery this week. Bitcoin has settled above $8,000 as the positive sentiments returned to the market.
What’s going on
The cryptocurrency industry is bubbling with events and news; however, few of them have potential to influence the market as it is oh so typical for cryptocurrencies to live their own lives and be very picky about the things they react to.
Regulators all over the globe continue to tighten the grip over the industry on an attempt to take under control the new type of asset that is considered very risky due to volatility, high level of fraud and cybersecurity issues. Thus, the Lithuanian government approved the changes to anti-money laundering legislation to include the cryptocurrency exchange operators into the scope of the law.
Basically, the crypto-related companies are now in the same boat with traditional finance firms. They have to register with the regulator and comply with all AML procedures, including customer identity verification. This requirement applies to transactions over 1,000 euro. The deals worth over 15,000 should be reported to the dedicated authority.
Also, the ministers of finance from G20 countries requested FATF (Financial Action Task Force) to develop recommendations and guidelines for cryptocurrency companies and asked the Financial Stability Board (FSB) to monitor risks. It all boils down to the fact that the global political and economic elite wants to be on top of current developments within the industry.
Meanwhile, the business has spotted the opportunities offered by blockchain and cryptocurrency technologies. Many high-tech and financial moguls like Visa, Facebook, Amazon, Uber, and Ubisoft are joining the game to capitalize on the innovations. Thus, in the latest development, Ubisoft, the company behind such iconic games like Assassin’s Creed and Far Cry, is said to create a marketplace based on Ethereum blockchain.
Also, Amazon buyers may soon be able to purchase goods for ETH coins through the partnership with B2B platform Opporty. This development has the potential to boost ETH popularity and promote its mass adoption.
Facebook and its unconfirmed cryptocurrency project is another hot topic of the week. According to some knowledgeable but anonymous sources, Visa, Uber, Mastercard, PayPal, among others paid $10 million each to participate in the new network. The invested money will form collateral reserves of the stablecoin that will be pegged to a basket of fiat currencies.
BTC/USD, 1D chart
BTC/USD has developed a steady upside trend this week with four green daily candles out of five. The coin managed to settle above $8,000, which translated into an extended recovery towards the recent high $8,449.
While the price has retreated to $8,400 by the time of writing, the upside potential remains strong with the next solid resistance as high as $9,000. Strengthened by the upper line of 1-day Bollinger Band, this area may become a hard nut to crack for the bulls. However, Once it is cleared, the upside is likely to gain traction with the next focus on $9,500 (Pivot Point 1-week Resistance 2).
On the downside, BTC/USD needs to stay above psychological $8,000 to retain positive stance. This support area is reinforced by SMA200 (Simple Moving Average) on a 4-hour timeframe. A sustainable move below this handle will open up the way towards the next bearish aim of $7,500. A confluence of strong technical indicators, including the weekly low and lower line of 1-day Bollinger Band is likely to stop the sell-off for the time being.
Once it is cleared, the sell-off is likely to gain traction with the next focus on $7,300 (the lower line of the previous consolidation channel) and $7,000 strengthened by SMA50 (Simple Moving Average) on a daily chart.
The Forecast Poll of experts improved significantly since the previous week. Expectations on all timeframes are bullish, while average price forecasts are well above $8,000. Moreover, the quarterly forecast implies that the price may move above $9,000.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.