Analysts found two reasons for the growth of bitcoin

Analysts found two reasons for the growth of bitcoin

  • Analyst Willie Wu Plotted Bitcoin Correlation With Traditional Markets.

  •  Bitcoin charts reflect bullish patterns on the web.

  • Bitcoin and Gold May Enter Accumulation Phase.

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The coronavirus continues to wreak havoc around the world, so business and finance are struggling to get a breather. Analysts have found some bullish patterns by studying charts to gauge Bitcoin’s performance against other assets..

Over the weekend, Bitcoin consolidated above $ 6,000, but by the beginning of the new week, it began to lose ground, dropping below this level. BTC then got a boost from new Fed measures announced on Monday and surpassed the $ 6,000 support area again.

Weakening ties

Analyst Willie Wu plotted bitcoin’s correlation with traditional markets and found “loosening ties.” He added that the recovery will not be preceded by a V-shaped decline, but a long period of accumulation..

The next key event is confirmation of BTC decoupling from traditional markets. Here’s a bunch of charts, many are bullish.

Analysts found two reasons for the growth of bitcoin

I will note that I don’t expect a V-shaped bottom, I think there will be time, an accumulation range before moving up.

– Willy Woo (@woonomic) March 19, 2020

The first chart showed that both gold and BTC are already less associated with the S index&P 500, which is still in free fall. After peaking in early March, gold fell 12% to a three-month low, showing that there are no safe havens at all during this crisis..

Silver is even worse; it has lost almost 38% over the past month as industry stalls, hindering demand growth.

Analysts found two reasons for the growth of bitcoin

Equity markets fell more than 30% in less than a month and oil prices plunged 57% over the same period. [MarketWatch]

According to the analyst, gold and bitcoin may enter the accumulation phase. The following graph shows that the bitcoin miners’ energy consumption ratio has rebounded strongly, with large amounts of energy being pumped into the network, which is a bullish sign..

The state of the bitcoin network

The expansion of the Difficulty Ribbon after a period of squeeze also indicates a strengthening of the network, while the price-to-issue ratio of bitcoins, which reflects the net investor positions in the chain, is recovering..

Little time has passed at this point, and the effects of the coronavirus outbreak are likely to persist until the end of this year..

Job cuts and company closings will reduce investment in high-risk assets like bitcoin. However, institutional investors still have opportunities for accumulation; due to the halving, recovery may begin.

The massive fiscal stimulus implemented by central banks around the world is also fueling the growth of limited assets like bitcoin as fiat continues to depreciate. Printing more money has never been an effective solution to the economic problems caused by the monstrous debt bubble.

Bitcoin may face even greater challenges in the short term, but not so bad for long-term investors.


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