(DAILY NOTION): BTC/USD Still in Consolidation, Will the Bulls Reappear Anytime Soon?

Source: Yahoo Finance

The Bitcoin bulls are taking a break, as the price moved downwards from $46,222.17 at the beginning of Feb 10 to hit the day’s low of $43, 909.83. Although it has moved up since then, the bulls are struggling to gain momentum to power upwards and have been trading sideways. At the time of writing, BTC/USD is at $45,113.51, which represents a 4.2% dip from yesterday’s high. BTC/USD is trading above its 50-day Moving Average (MA) while the Moving Average Convergence Divergence (MACD) is still showing a struggle between the bears and the bulls, with no clear indication as to who is the winner at the moment. However, the Relative Strength Index is moving sharply upwards and currently stands at 60, hinting towards buyers’ appetite in the market.

Anil Panchal, an analyst from FX Street believes that towards the upside, key resistance levels lie at $47,000, $48,200, and $50,000. Meanwhile, the bears would need to take on key support levels at $41, 900, $32, 900 (which is an ascending trend line from Dec 11), and subsequently $27,770. He also opines that a pullback can be expected from BTC/USD.

As the market is still digesting the after-effects of Tesla’s $1.5 billion investment into Bitcoin, Janet Yellen, the new U.S. Treasury Secretary has commented that ‘misuse of cryptocurrency is a growing problem, as cryptocurrencies can be used to launder profits of online drug traffickers and finance terrorism.’ She made this statement to regulators and private sector attendees during a Treasury-hosted forum, Forex Live reported.

Yellen’s sentiment is a strong echo of European Central Bank’s (ECB) President, Christine Lagarde’s statement in mid-January this year, where she called for a stricter regulation as Bitcoin is a speculative asset with high volatility and alleges that it supports money laundering.

In a classic battle between the old guards and the new, a certain amount of conflict should be expected. Similarly, in this tussle between traditional investment assets and digital currencies, resistance from the former is not a surprise. However, this time, the stakes are different as institutional investors join retail investors to flock towards what they believe can be a key player in the future: Bitcoin.

This is also an unprecedented time we are living in: the Covid-19 pandemic has gotten a lot more people comfortable with digital services and this leaves more people open towards cryptocurrency, in addition to the millennials who have long since been supportive of the digital currency. Printed money is losing favour especially in light of the fact that 20% of all the dollars in circulation were printed in the year 2020 alone, an article in Morgan Stanley cites.

That leaves us with a question to ponder on: can the old guards still hold down the fort? In the meantime, it is clear that Bitcoin will not be leaving the limelight anytime soon...whether the bulls or the bears hold the reins.

BTC/USD (as of Feb 11, 2021, 9.15 a.m., GMT +8) - $45,113.51 

FOLLOWME BTC/USD User Sentiment (as of Feb 11, 2021 at 9.50 a.m.)

Short – 59.06%

Long – 40.94%

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