Apparently, Bitcoin halving, as seismic as it promises to be and set for early May 2020, fails to leave crypto and BTC forums for obvious reasons. The community is evidently split.
Will Contrarians Set in?
However, most are bullish of the future. But, for some unexpected explanations-and if prices fail to follow previous paths and miners capitulate as mining becomes a loss-making venture due to lack of buy pressure, then contrarians would have the upper hand, and perhaps the last laugh.
Hash rate—that is participation and security of the network, follows price. Should the latter collapse, hash rate may follow suit—at least temporarily before springing back as the difficulty readjusted.
Some quarters believe that the bullish air from traders will soon be squashed and in their assessment, BTC is over-valued. They figure out that only once halving is executed and miners readjust accordingly, is when the event will be priced-in. Then, BTC will be fairly valued and prices readjusted in line with the existing demand.
Effect of Supply-Demand
Their reasoning could be valid. However, considering the basic law of supply and demand, it is highly likely that sustained demand could play positively for price in light of reduced rewards. Scarcity means demand and this translates to higher prices, a boon for investors.
BTC Addresses Rise is Linear
Meanwhile, the number of addresses holding 1 BTC and more has increased, tracking a linear path over the last decade according to findings from GlassNode. Presently, there are 784,149 unique BTC addresses, highlighting the level of distribution and interest from end users.
BTC/USD Price Analysis
![Bitcoin [BTC] Price Analysis: Bitcoin Prices Cool off, Retesting the 20-day MA, but is $7,500 on the Table?](../../../wp-content/uploads/2020/01/Bitcoin-Daily-Chart-for-Jan-24.png)
At spot rates, BTC prices are retracing, and down 4% in the past 7 days of trading. Expected, BTC price is retesting the middle BB, or the 20-day moving average, but the trend is still bullish.
Behind today’s slide is dropping trading volumes and bears are yet to revise losses of Jan 14. The bar is conspicuously bullish and from an effort-versus-result analysis, buyers have the upper hand.
A pullback towards $7,500-800 is more likely. This zone falls squarely within the 50-61.8% Fibonacci retracement levels of the recent trading range.
A dip towards $7,500 will complete the retest phase and a decent bounce from that zone at the back of decent, above-average trading volumes could lift price back to Jan 2020 highs of $9,200. On the flip side, sustained losses could see BTC tumble to $6,600 or Dec 2019 lows.
Chart courtesy of Trading View-Coinbase
Disclaimer: Views and opinions expressed are those of the author and is not investment advice. Trading of any form involves risk. Do your research.
The post Bitcoin [BTC] Price Analysis: Bitcoin Prices Cool off, Retesting the 20-day MA, but is $7,500 on the Table? appeared first on Crypto Economy.
