Bitcoin showed an impressive rally for over a thousand dollars last week. What's more, the altcoin market tried to rise from the dead. For a long time, there was no even hope for that. However, all the right things once ended. In our case, maybe it's just interrupting. At the beginning of the working week, Bitcoin lost almost 5% and traded around $8,650 on Monday morning. Investors considered the excess of $9K as enough level to take-profit. In the short term, it will be essential for Bitcoin not to decline below $8.5K and stay above the 200-day average. Altcoins also fall similar to bitcoin.
However, there was an important precedent: the buried by almost everyone asset class suddenly rose and showed at least speculative demand. Therefore, despite the impressive growth of the Bitcoin, it was still the altcoins that were the main event of the past week. Price of the Ethereum (ETH), the second most capitalized cryptocurrency, jumped 22%, while Bitcoin Cash (BCH) soared 48% and reached its maximum. The star of the Pump&Dump scheme, which strongly reminded market participants 2017, was the Bitcoin SV coin, spiked by 167% between January 13 and 15.
In a broader perspective, bitcoin-maximalists still believe that the "altcoin season" will be relatively short. Nevertheless, it will provide its holders with the opportunity to earn from significant spikes of volatility.
Still, the main star of 2020 should be bitcoin, where the $10K threshold may boost new wave due to internal factors (halving, institutional trading, real-world companies' collaboration), as well as external factors from the traditional financial market. Among the latest, we should name short sighted monetary policy that depreciates national currencies, geopolitics, populism, and the imminent approach of stock market correction. Cryptocurrencies could become a kind of the "second pole" in the world of financial flows if the infrastructure for investment continues to be improved. It should be understood that these digital assets will become much more "down-to-earth" and, as before, the market will always play against the mass sentiment.
FxPro UK Limited is authorised and regulated by the Financial Services Authority, registration number 509956. CFDs are leveraged products that incur a high level of risk and it is possible to lose all your capital invested. Please ensure that you understand the risks involved and seek independent advice if necessary.
Disclaimer: This material is considered a marketing communication and does not contain, and should not be construed as containing, investment advice or an investment recommendation or, an offer of or solicitation for any transactions in financial instruments. Past performance is not a guarantee of or prediction of future performance. FxPro does not take into account your personal investment objectives or financial situation. FxPro makes no representation and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied by any employee of FxPro, a third party or otherwise. This material has not been prepared in accordance with legal requirements promoting the independence of investment research and it is not subject to any prohibition on dealing ahead of the dissemination of investment research. All expressions of opinion are subject to change without notice. Any opinions made may be personal to the author and may not reflect the opinions of FxPro. This communication must not be reproduced or further distributed without the prior permission of FxPro. Risk Warning: CFDs, which are leveraged products, incur a high level of risk and can result in the loss of all your invested capital. Therefore, CFDs may not be suitable for all investors. You should not risk more than you are prepared to lose. Before deciding to trade, please ensure you understand the risks involved and take into account your level of experience. Seek independent advice if necessary. FxPro Financial Services Ltd is authorised and regulated by the CySEC (licence no. 078/07) and FxPro UK Limited is authorised and regulated by the Financial Services Authority, Number 509956.