Βitcoin - BTCUSD
One of the major news for Bitcoin price recently came from the United Kingdom – the FCA (Financial Conduct Authority) forbids trading cryptocurrency derivative products starting with January 2021. One of the main reasons cited by the FCA is customers’ lack of understanding of the crypto market and what really moves the market.
Another one related to the fraudulent activity in the crypto space. This is recently a concern for the U.S Department of Justice (DOJ) too.
The illicit use of cryptocurrencies in ransomware attacks or other fraudulent activities drew the attention of the DOJ, and new regulation in the area is expected. If that is the case, more restrictions for Bitcoin mean less interest from the investing community too.
The price of Bitcoin did receive a boost recently. Last week Square announced a $50 million investment in Bitcoin, claiming that Bitcoin aligns with the company’s mission. Jack Dorsey, the name behind Square, is known for its interests in Bitcoin, and Square’s decision proves that there is a potential for public companies to diversify into the crypto space.
But until there a regulatory framework exists, any new developments in the crypto space will remain isolated.
The problem with Bitcoin is that everyone is bullish. No matter where you turn, you hear a projection that Bitcoin will reach this or that level (much higher) in the future. However, when the consensus favors one direction, it is not certain that the market will go there.
Bitcoin price met dynamic resistance on its move higher. It bounced from the $10,000 level and gained over 15% in a very short time following Square’s announcement.
The $10,000 still looks like a pivotal level for Bitcoin. Bears may want to sell at the market and place a stop-loss order above the previous market high. Effectively, selling at $11,500 with a stop at $12,200 and targeting a move below the $10,000.
