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Ups and downs of bitcoin. Does this crypto have a future?
2019-11-11 • Updated
The saying “buy the rumor, sell the fact” in the best way possible fits to bitcoin trading. In the recent week, the cryptocurrency experienced significant reverberations. At the present moment, investors expect the consolidation followed by the return of quotes to their previous highs.
Having spiked above $1300 (all-time high of the cryptocurrency) on the speculation that US Securities and Exchange Commission could approve the first bitcoin exchange-traded fund, the cryptocurrency slumped to $980 after investors’ hope for approval was dashed. Then, there was a near-term consolidation that ended with a new even deeper drop to $942. The latest selloff was driven by intensifying wrangle over whether and how to increase the capacity of the blocks that bitcoin transactions are processed in.
This Monday bitcoin managed to regain its footing. In the course of three consecutive days, BTC/USD spiked to $1081.80. The current overtone is still bullish, but when we may expect a new streak of losses. Big question mark; there is no such thing as “economic calendar for bitcoin.” Therefore, poor bitcoin watchers had to monitor the news sites striving to glean the necessary fundamentals.
Some experts believe that in the future bitcoin can be replaced by other nascent cryptocurrencies. That’s to say, it will sidestep on the rise of such currencies as Ethereum, Dash, Monero. Market analysts noted that after bitcoin started falling many traders switched to soaring ether. Some believe that Ethereum project has more potential than bitcoin. The former one was recently been supported by a consortium of corporations including JPM and IBM and tripled in value in the course of this month having posted its record high in the mid $50.
As Reuters experts report, traders in the space are looking for better returns in the more volatile and nascent cryptos as they look for extraordinary returns that bitcoin used to offer them when it was a “kid” cryptocurrency. Additional headwind for the bitcoin – the recent China’s crackdown eliminating the possibility of using bitcoin to bypass China’s capital controls. So, Ethereum and other nascent cryptos can experience a significant upsurge in the near term (consider buying them for higher returns), while the further uplift of their grandad – bitcoin – is rather problematic.
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The views here are solely based on Technical Analysis techniques using my personal Smart Money approach. Hence, it is important to understand that the trading of CFDs comes at a risk; if not properly managed, you may lose all of your trading capital. To avoid costly mistakes while you look to trade these opportunities, be sure to do your own due diligence and manage your risk appropriately.
Even though we've only witnessed sluggish movements from the Dollar over the past few weeks, the general idea and bias still seem intact and untampered. The bullish impulse however can be seen as "searching for support".