Why Bitcoin Detractors Shouldn’t Raise to Celebrate Its Latest Price Pullback
Bitcoin’s detractors have reason to be dancing in the streets these days as the world’s leading decentralized currency is going down with its latest price. Bitcoin is now hovering around $10,000 USD after reaching its most recent peak of $12,000 USD. But many believe the music is about to stop, and that the next Bitcoin Bull Run is coming sooner rather than later.
Bitcoin’s Price Is Mimicking the Stock Market
Ever since the stock market began plummeting in the middle of March amid the spread of the coronavirus, governments around the world are continuing to step up to the plate and take care of their citizens with various stimulus packages, particularly in the Western world. This is leading to many investors feeling very confident about the future of the economy and the likelihood of a vaccine for the coronavirus being just around the corner. Add to that the fact that many people around the world now have extra money to play with in terms of investing, and you have inflated stock prices.
Now we are experiencing a downturn in the stock market because investors have to deal with the fact that the second and third fiscal quarters of the year are reflecting higher jobless claims across North America. Still, the price correction in the stock market is likely to only be temporary, which means the same might be true for Bitcoin.
U.S. President Donald Trump is continuing to Decouple the U.S. Economy from China
When the United States coughs, Canada sneezes. If America is really dedicated to not being so dependent on China, it may mean the continued devaluation of the American dollar, which means more investors will look to digital currencies as a safe haven for their money.
The Next Key Level of Support for Bitcoin
Historically speaking, no matter what a short-term retracement does to the price of Bitcoin, the reality is more and more people are becoming interested in holding onto the asset as a store of value. This means that price drops are unlikely to reach below certain levels. The next key level for Bitcoin is $9,500 USD. As long as it bounces off that price point, we are likely to see a major move upwards. That’s good news for people who love Bitcoin.
Written by: Jack Choros
Writer, content marketing at Netcoins.