The Bitcoin bulls are refusing to allow levels to dip below USD 10,000 for longer than a day, and no more so on the weekend, as they have been showing the entire month of July.
After bears took half of the half of 24 hours, Bitcoin suddenly sprang a hike at almost exactly midnight UTC, jumping from USD 9,836 to USD 10,146, before making a high, first at USD 10,193 in the next half hour. Price has somewhat stabilized since then, trading right now at USD 10,082 at exactly 10:00 am UTC (CoinDesk).
There doesn’t seem to be any ground lost or gained this summer, with the heatwave in Europe failing to ignite a certain direction in neither the bulls’ nor the bears’ favor. It does appear that our earlier analyses over the past week are true. Each dip will be bought in by buyers who want to get in bargain entries, while each spike will be taken as an immediate profit-taking opportunity by sellers who feel there will be future dips to re-enter. Both seem to be right so far!
The chatter on social media continues to drift between positive and negative opinion on the immediate direction for Bitcoin. However, some quarters have been picking up on topics surrounding a recent investigative article by Bloomberg peering into the motives behind the European Central Bank’s (ECB) upcoming policy changes that many believe are designed to try and revive a swooning Eurozone economy. These potentially include interest rate cuts and piling on measures for quantitative easing, much like what the Federal Reserve recently did in the US under Trump administration.
ECB President Mario Draghi painted a bleak picture of the Eurozone which is getting “worse and worse”, blaming trade wars, Brexit, China’s economy for the weakening market.
This unsurprisingly provided fodder for regular pro-Bitcoin and anti-banking influencers such as Anthony Pompliano, who claims that the ECB has now provided pure “rocket fuel” that will shoot Bitcoin price to the stratosphere.
ROCKET FUEL: They’re going to cut rates and print money right as we march towards the Bitcoin halving.
Buckle up. This will be wild 🚀 pic.twitter.com/QotDXKTJRj
— Pomp 🌪 (@APompliano) July 25, 2019
According to Pompliano, the timing couldn’t be better, as interest rate cuts and more money printing would further weaken its fundamentals, in strong contrast with Bitcoin’s opposite theories as a scarce and deflationary currency, with less than a year left to its next halving event – whereby new bitcoins generated by miners finding new blocks would be decreased by 50% to only 6.25 BTC from its current block rewards of 12.5 BTC.
With this halving expected to happen sometime in May 2020, Pompliano insists that a USD 100,000 valuation is only a matter of time.
Bloomberg says that the ECB continues to show a willingness to inject ever-increasing stimulus to elevate price growth for a long period, by adding a crucial line to its statement on “commitment to symmetry”:
“The Governing Council has tasked the relevant Eurosystem Committees with examining options, including ways to reinforce its forward guidance on policy rates, mitigating measures, such as the design of a tiered system for reserve remuneration, and options for the size and composition of potential new net asset purchases.”
Bloomberg economists Maeva Cousin and Jamie Murray conclude: “Taken together, the wording of today’s decision and press conference strengthens our conviction that the ECB will deliver a meaningful dose of stimulus in September.”
It would seem that Forbes would support this ECB rocket fuel theory as well, as it also says that US President Trump will eventually prove to be “great for the Bitcoin price”.
It first predicts that the way Trump had called for a US dollar devaluation by threatening Federal Reserve Chair Jerome Powell would set off a currency war, with central banks all over the world, and now ECB, considering “easy monetary policy” to stave off economic collapse from debt. Last month during a Bitcoin 2019 conference, analysts said this would create a perfect storm for Bitcoin with investors seeing it as the one true alternative to inflationary currencies all over the world.
Forbes then goes on to say that Trump’s decisions to block international remittances and threaten countries who did not comply, coupled with his administration’s criticism of end-to-end encryption, would also force people who previously had no reason to use Bitcoin, to use it, to circumvent these bans and restrictions.
Bitcoin as a store of value that cannot be censored or seized if used correctly is exactly the sort of thing that would thrive, should all these cracking down actions take place.
But all these things, even if they do take place, will not be any time soon, and Trump does have just over a year left before he will need to seek re-elections. Could we be seeing more rushed decisions like this to push Bitcoin into moon territory? Or will we be seeing more organic growth in 2020 after halving?
Time will tell, but the weekend is here, and the speculators never sleep.
Image Courtesy: Pixabay