Bearish Narratives Still Gripping the Bitcoin Price

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The price of bitcoin is trading around $6,450, keeping above $6,000 for about a fortnight now, since we crashed to $3,850 in mid-March.

In 2018, during the crypto winter, the same day the world’s leading cryptocurrency was trading around $6,800. Similarly, the S&P 500 is currently trading around 2610 closer to the level seen in 2018’s 2640.

With “1 dollar = 1 dollar. All clearly very stable,” said economist and trader Alex Kruger.

Currently, 1 US dollar is worth about 15,321 sats while a year ago it was 24,287 sats, 14,438 sats 2 years ago, 92,614 sats three years ago, 242,313 sats 4 years ago, and 20,576,132 sats 8 years ago.

First, What’s Bullish?

To start with, the market is giving off some recovery signs. Open Interest on perpetual swaps has yet again gone back above $1 billion after remaining around $800 million from March 12 to March 27.

More importantly, the retailers are buying the dip as evident from the increased trading and sign-ups on cryptocurrency exchanges during and following the week after the market crash.

As we reported, the Japanese exchange BitBank recorded an increase of 40% in weekly account registration while Kraken saw a jump of a whopping 83%.

“Everyday, [we’re seeing] more sign-ups, more verification requests, more people funding their accounts, and that to us is a signal that things are heating up,” said Kraken CEO Jesse Powell.

Coinbase also reported that its new user signups were 2x to last 12-month averages.

“BTC supertrend on the daily still showing we are in a confirmed bull run. Until we get a short signal again I’m in buy the dip mode. People had a chance to buy sub 4k, sub 5k, and now sub 6k. Next round of fomo buying might happen near 7k,” said the analyst with the pseudonym Income Sharks.

Now, the Bearish Pressure

While positive factors are slowly gaining traction, the bearish pressure is just as gripping if not more.

According to analyst Jacob Canfield, one of the bearish narratives is the bitcoin miners who hoarded BTC and may create a selling pressure on the price when they start to sell. We have already seen that this price crash has pushed the miners into the unprofitable territory as the cost of mining one BTC is now more than its market price.

The PlusToken ponzi scheme remains a danger for the bitcoin price that earlier this month could have added some initial pressure to the price when they dumped 13,000 BTC on the market. Given that they aren’t out of their stolen BTC, it could very well happen again.

Just recently, Mt. Gox trustees’ civil rehabilitation plan got extended to July 1, 2020, in a court-order submission deadline. This Canfield said could mean that they are “back to sell some more.”

Now, that fact that the flagship cryptocurrency continues to act as a risk-on asset, following the stock market might not bode well for Bitcoin if S&P 500 takes another hit which it could according to Goldman Sachs analyst who said, “the U.S. equity market hasn’t found a bottom yet.”

They noted that “bear markets are often punctuated by sharp bounces before resuming their downward trajectory,” and during the last financial crisis, the market low didn’t occur until March 2009.

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