Bitcoin Price: 5 Things That Will Impact the Crypto Market This Week
Bitcoin (BTC) maintained $7,000 despite strong resistance on April 20 as oil crashed through fresh support levels towards $10.
Heading into what promises to be a choppy week for traditional markets, here are five things to watch for Bitcoin traders in the coming days.
Cryptocurrency market daily overview. Source: Coin360
BTC price resistance
Data from Coin360 and Cointelegraph Markets showed some rare calm for BTC/USD as the week began. The pair circled $7,190 at press time, having lingered inside a $300 corridor over the weekend.
Bitcoin has now maintained $7,000 support since April 16, while analysts continue to warn that year-to-date resistance and the 200-day moving average both present barriers to further growth.
Bitcoin 1-day price chart. Source: Coin360
BTC/USD began 2020 at $7,295, while the 200-day moving average currently sits at around $8,000.
“Breaking and flipping the yearly level and I assume we can continue towards $7,600,” Cointelegraph Markets analyst Michaël van de Poppe predicted on Monday.
“Rejecting at $7,200-7,250 and rolling over and my first targets are $6,600 and $6,800.”
Nonetheless, as last week ended, the cryptocurrency moved above the 50-day moving average, flipping previous resistance.
Oil plumbs multi-decade lows
In traditional markets, the picture remained highly varied. Previous omens of $10 oil appeared to be slowly coming true as WTI crude fell below $15.
The last time such prices were recorded was in 1999, while a $10 price tag was rarely seen on market closes even then — since 1987, a close of $10.82 formed the record low, according to data from Macrotrends.
As Cointelegraph reported, even United States President Donald Trump has appeared resigned to the idea of oil falling even as low as single digits per barrel.
“No one wants oil right now,” Bloomberg summarized while tracking the decline on Monday.
Stocks climb but no one’s employed
Paradoxically, stock markets continue to gain, despite millions of unemployed workers still appearing and the U.S. and other governments supporting them with helicopter money.
Commentator Holger Zschaepitz noted on Monday that a basket of stocks known as FANGMAN — Facebook, Amazon, Netflix, Alphabet, Microsoft, Apple, Nvidia — traded just 7% below its all-time highs as the week began.
Since its crash in March, Bitcoin has shown a continued correlation with the fortunes of major stock markets.
The increasingly bizarre contrast has formed the topic of intense scrutiny by Bitcoin supporters, however, with Max Keiser arguing that it represents the illicit transfer of wealth away from workers and companies to banks and the state.
Halving countdown
Bitcoin’s third seminal block reward halving is now just three weeks away. Set to reduce the amount paid to miners per block to 6.25 BTC, the event will harden Bitcoin as money overnight.
In an interview on Sunday, Saifedean Ammous, author of the popular book “The Bitcoin Standard” made a simple argument for the halving’s positive impact on the Bitcoin price.
Once the flow of new Bitcoins halves, he argued, demand could theoretically also halve and still keep BTC/USD at its current level.
PlanB, the analyst behind the celebrated stock-to-flow price model, meanwhile sticks by its latest forecast — by the end of 2020, Bitcoin should trade at around $30,000.
A healthy difficulty adjustment
On Tuesday, Bitcoin’s difficulty adjustment feature means it will become 8.5% more difficult to find new blocks. This is one of the rare larger upticks after difficulty — and interpreted as a bullish sign by some analysts — adjusted downwards following last month’s price crash.
As Cointelegraph often reports, difficulty plays a key role in ensuring Bitcoin remains hard money — price fluctuations do not result in coins being mined faster or slower, and the stock-to-flow ratio is thus preserved.
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