- Bitcoin (BTC) rose ahead of the May halving.
- Cryptocurrency investors await monetary policy decision next week from the Federal Reserve.
- Volatility in the price of oil causes movement in cryptocurrency markets.
Market Trends This Week
Bitcoin (BTC) prices continued to drift higher this week gaining more than 4 percent but finishing off the highs. Prices were buoyed by the roll-out of the digital Yuan test in China. The test by the Chinese is the first large scale testing of digital currency. Signals from U.S. officials that an opening of economic activities is to happen sooner rather than later also helped demand.
The price of BTC was resilient in the face of turbulence in commodities. For the first time in history, the May contract for crude oil futures went into negative territory. As oil rolled over to the June contract prices staged a dramatic recovery of more than 40 percent.
This Week’s Topics
- Facebook’s (FB) Libra will introduce multiple individual cryptocurrencies linked to fiat. (4/17)
- The next Bitcoin (BTC) halving will occur on May 12. (4/23)
- Circle Co-founder and CEO says U.S. dollar backed stable coins have seen demand increasing unexpectedly. (4/20)
- The People’s Bank of China (PBOC) acknowledged that it is in the process of testing the mobile app for the digital Yuan. (4/20)
- Facebook hires 50 new employees to accelerate the development of wallet “Calibra”. (4/22)
Next Week’s Market Forecast
Cryptocurrency investors will be watching to see what the U.S. Federal Reserve decision on monetary policy will be on Tuesday. Any more shocks to commodity prices or equity markets due to the Corona Virus will also be in focus.
Overall, cryptocurrency investors are in wait-and-see mode. Volatility has dropped as investors await the next Bitcoin (BTC) halving which will occur on May 12. The halving will reduce the amount of newly minted BTC by 50%. Less BTC being produced could mean more demand at higher prices. The last BTC halving occurred in 2016 and sent prices soaring. Much has changed since then, including the meteoric rise in BTC’s popularity.
BTC investors will be watching the $6,400 low as support (coincides with support level from late last year) and the $7,700 level (this week’s high) as resistance.