On Wednesday, May 26, the bitcoin rate again rose above $ 40.7 thousand, today the first cryptocurrency is trading at $ 38.4 thousand. Over the past day, the asset has fallen in price by 5%, writes RBC Crypto.
The value of the digital coin began to actively increase after the head of Tesla and SpaceX, Elon Musk, announced on May 24 a meeting with American miners, at which the topic of using renewable energy sources for cryptocurrency mining was discussed.
On May 13, Tesla temporarily stopped selling its products for bitcoins due to the non-environmentally friendly way of mining them. Musk noted that the company will not accept cryptocurrency as payment until its mining begins using renewable energy sources.
“We do not believe in the collapse of quotations”
Positive news does not mean a reversal of the market yet. On the weekend, when we were in the fall, it was obvious that there would be a retest of the $ 30K mark, and at that moment the market had enough liquidity to buy. At the same time, it was clear that the liquidity for sale is at the level of $ 40-42 thousand, so it will be interesting to watch what will happen now.
We do not believe in a 50-70% fall in quotes. I think $ 31-38 thousand is a good price to buy at the moment. We will continue to observe.
The recent fall has been painful for many market participants. Discussions have begun among institutional players that have provided a significant inflow of capital to the digital asset market, whether they can afford such volatility. Many funds have significant restrictions on working with highly volatile assets. Bitcoin and altcoins have confirmed that they are.
“The question of reaching new highs is postponed”
The active phase of the decline in bitcoin has stopped. If we consider the technical picture, then the May collapse can be interpreted as the resolution of the “head and shoulders” trend reversal pattern. A rebound to the neckline area of about $ 44,000 is now possible, followed by a downward movement.
The rhetoric about the non-environmental friendliness of bitcoin mining is gradually replenishing the cohort of bears, which certainly postpones the question of reaching new highs.
“Cryptocurrencies May Show Bounce”
Lead strategist at EXANTE Janis Kivkulis
The crypto market not only reacts violently to bad news, but also quickly digests it. Key levels have not been broken through, and there are already signs of active asset repurchase. Various funds and large investors have already begun to buy back the bottom, confirming their long-term confidence in the prospects of the crypto market.
Musk’s tweets and new “attacks” from China, as well as hints from the United States in the context of taxation of cryptocurrencies may have a rather short trail until real action is taken. In the very near future, cryptocurrencies may show a rebound, and the ability to overcome $ 40 thousand and gain a foothold higher for bitcoin will be fundamentally important.
In the near future, it is worth continuing to actively follow the comments of the officials of the largest Central Banks and the Chinese authorities. In the meantime, market participants perceive the fall as an excellent opportunity to open positions with a large discount.
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