Bitcoin Bounces-off 50% Fibonacci Retracement
The BTC/USD was closed at $39563.0 after placing a high of $39563.0 and a low of $36436.0. BTC/USD rose for the 7th consecutive session on Tuesday despite the denial from the internet giant Amazon about accepting cryptocurrencies as payment on its site. Bitcoin breached the critical level of $40,000 on Monday after the speculations came in the market that bitcoin was planning to add cryptocurrency in its payment mechanism; however, on Tuesday, the e-commerce giant denied such rumours and said speculation about specific plans for cryptocurrencies was not true.
The spokesperson from Amazon said that they remained focus on exploring what this could look like for customers shopping on Amazon. All this fuss came in the market following a job advertisement for a Digital Currency and Blockchain Product Lead from Amazon. Furthermore, a London-based newspaper City AM, also reported that Amazon was considering accepting bitcoin payments by the end of the year. Despite the denial from Amazon, Bitcoin continued moving in the upward direction and remained green for the day.
Meanwhile, the government of Kazakhstan was reportedly planning to enable banks to process cryptocurrency purchases. The country's ruling body has plans to allow local banks and financial institutions to offer cryptocurrency exposure to their clients. The government has decided to run the implementation for a year, after which it will be decided later whether to extend it. This news added further strength to the already high prices of BTC/USD on Tuesday.
On the other hand, the International Monetary Fund issued a warning against the latest El Salvador's bitcoin law. The IMF officials Tobias Adrian and Rhoda Weeks-Brown stated making crypto a legal tender. They noted that new digital forms of money provided faster and cheaper transfer and could enhance financial inclusion, resilience, and competition among payment providers.
However, they also noted that cryptos require significant investment and difficult policy choices. They wrote that if goods and services were priced both in the real and cryptocurrency, businesses and households would spend significant time and resources choosing which money to hold rather than engaging in productive activities.
They further said that the exchange rate would expose the government revenues to risk if taxes advance in crypto while payments remain in the local currency or vice versa. Additionally, the weakness in the U.S. dollar also played an essential role in keeping the BTC/USD higher on Tuesday. The cryptocurrency remained green for the day as the U.S. dollar was declining over the cautious behaviour of investors ahead of the Fed policy meeting. The U.S. Dollar Index remained lower on Tuesday at 92.32 level and pushed BTC/USD higher as both share a negative correlation.
BTC/USD Intraday Technical Levels
Pivot Point: 38520.7
BTC/USD - Technical Outlook
The leading cryptocurrency, Bitcoin, tests the $40K resistance level once again. Only this time, the bullish power seems more substantial as the BTC/USD has closed "three white soldiers". This candlestick pattern suggests a strong bullish trend in Bitcoin; therefore, the breakout of 40,475 resistance level can expose BTC/USD price towards 41,365 and 43,500. On the flip side, the support continues to hold around 39,017 and 37,650 levels. The MACD is holding in a buying zone. Therefore, the bullish bias dominates Bitcoin prices. All the best
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