Bitcoin (BTC) reaches its highest price in more than two months a few days before the new inflation figures are published.
The market-leading crypto currency climbed 1.65% on August 8th to a price of 45,363 US dollars, which means that the current high flight can be continued, which is already a plus compared to the low of 37,300 US dollars on August 5th of 21.62%.
The competition is not sleeping either, because pursuer Ether (ETH) has also increased by a strong 29.78% since August 3, when a low of 2,630 US dollars was recorded, and this Sunday again to over 3,000 US dollars Dollar jump. The changes to the functioning of the transaction fees of Ethereum by the London hard fork also have a deflationary effect on the supply of the second largest crypto currency, which could further boost its price in the future.
Good general conditions
The US Department of Economics and Labor will publish the new inflation figures on August 11th, with experts forecasting an increase of 0.5% for July. The consumer price index (CPI) had already risen 5.4% year-on-year in June, which is the highest relative jump in 13 years.
This news is cause for joy for Bitcoin investors, as increasing inflation saved the market-leading cryptocurrency from falling below 30,000 US dollars in the most recent crash. The current upswing of over 40,000 US dollars sparked a new impetus, which now even lifts Bitcoin back to over 45,000 US dollars, which means that the “summer slump” may already be a thing of the past.
Lex Moskovski, the head of investment at Moskovski Capital, points to a price chart from the crypto market research institute Glassnode, which shows a significant increase in new investors in the Bitcoin network. The growth comes in step with the current upward trend.
“The number of new Bitcoin investors has reached a new record high,” said Moskovski notices.
Crypto analyst Willy Woo assumes that Bitcoin can even be heaved back over 50,000 US dollars, as he currently sees the demand as significantly higher than the existing supply. In particular, the excessive buying interest of long-term investors would ensure that there would be a real shortage in the next few days and weeks.
Woo, in turn, refers to a diagram that he had already posted on July 15, when the Bitcoin price slipped to $ 36,675 after the record run. Here he has drawn in the various phases in which there was a shortage and how these affected the further price development.
In this regard, Woo explains:
“The fundamentals cannot predict the short-term price development, but in the long term the price is always close to the fundamentals. They currently have a market value of 53,200 US dollars, with the standard deviation in the range between 39,600 – 66,800 US dollars (with 68.5% certainty). “
No free ride yet
However, it does not yet give the full green light, as the Fibonaci retracement indicates that the current upswing may be short-lived.
Because whenever Bitcoin sets new records, the price initially goes back to the moving average of the last 200 weeks (200-week EMA, yellow line) before a new upward trend can be stimulated.
There have been similar constellations in the past as well, which only turned out to be a flash in the pan after the support at the 23.6% retracement level was tested. Both upswings could not jump higher Fibonacci resistances, which means that a new uptrend did not occur in each case, as expected.
After falling to the 23.6% retracement level, Bitcoin was able to climb more than 50% to 7,357 US dollars in 2019, but at the 61.8% retracement level or at 10,613 US dollars an insurmountable one awaited Hurdle. Then it went back into the downtrend, which even lowered the market-leading cryptocurrency to a low of 3,858 US dollars in March 2020.
If such a scenario repeats, Bitcoin could face a similarly large hurdle at the 61.8% retracement level or $ 46,792. A rollback to the 200-week EMA would accordingly mean a drop below $ 20,000.
The analyst Keith Wareing, meanwhile, points out that an imminent overlap of two weekly Bitcoin funds indicates an imminent upward trend. The MACD indicator had already correctly predicted the beginning of the record run from the end of 2020.
“The weekly MACD is on the verge of a positive overlap”, as Wareing told his followers announcedwhen Bitcoin was at $ 44,500 today.