Bitcoin (BTC/USD) Forecast:
Bitcoin’s[1] recent price action[2] continues to demonstrate the powerful nature of crowd psychology and, more specifically, the role that influencers such as Elon Musk play in the market. Despite breaching the $48,000 mark, BTC/USD[3] gave back a portion of Monday’s gains following Tesla’s announcement of a $1.5 billion investment[4] into the digital currency. However, it appears as if major market players are following in Tesla’s footsteps after Twitter, Mastercard and Uber[5] have all announced their interest in adopting Bitcoin as an additional payment method.
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A combination of USD[7] weakness and speculative popularity continue to weigh on major cryptocurrencies[8], igniting the volatility regime that initially fueled the bullish reprisal of the ‘Bitcoin bubble’.
Bitcoin (BTC/USD) Technical Analysis
After breaking above $48,000 on Monday, price action retraced off of the key psychological level[9], falling to the 14.4% Fibonacci retracement level[10] of the Jan – Feb move, currently providing support around $45,277. For now, sentiment remains bullish, with the Moving Average Convergence Divergence (MACD)[11] crossing above the zero line, indicating that the short-term momentum continues to favor the bulls as major market players contribute to the rising demand for cryptocurrencies.
Bitcoin (BTC/USD) 4 Hour Chart
Chart prepared by Tammy Da Costa[12], IG
If bulls are able to push through resistance, a test of $50,000 may be in the cards, however, if bears break below current support, which may happen if regulators continue to seek more stringent laws regarding the holding and trading of virtual currency;
