From plunging to US$32k to finding a way to reach US$50k, Bitcoin price is swinging drastically
The past couple of weeks have been a roller-coaster ride for Bitcoin. Starting from plunging to US$32,000 to finding a way to reach US$50,000, Bitcoin’s price was on a constant swing. Amidst geopolitical tensions and associated macro weakness on the radar, BTC is striving to do well. But one thing for sure is that the cryptocurrency is in a do-or-die situation; either it could break through the US$50k mark in the coming weeks or is threatened by a death cross.
Generally, Bitcoin’s price is affected by a combination of factors like supply and demand, institutional adoption, the addition of features, etc. But this time around, Bitcoin price analysis completely relies on the geopolitical happenings across the globe. Although BTC price swings due to global happenings are not new, the intensity of volatility has increased drastically amid the Russia-Ukraine war.
Two major reasons are contributing to these price swings now. One is the overall fall of all financial assets’ value and price and the other is the increasing usage of cryptocurrency by Russians and the Kremlin to evade Western sanctions. Fortunately, analysts say that Bitcoin has found a support level at US$37,000-US$40,000 from where it could make a possible comeback.
Why Support Level Matters Now?
As mentioned above, Bitcoin has found a support level between US$37k and US$40k to stabilize future outcomes. However, resistance at US$46,700 remains in tack. Currently, BTC is on a mission to break through the resistance level before it is too late. Bitcoin price analysis suggests that huge swings are on the way. In the past year, BTC’s value was capped within the US$30,000-US$69,000 mark. Although analysts said that Bitcoin could reach US$100k in 2021 or early 2022, it seems very difficult at the current trend. Fortunately, a support level could act as a trigger to that amid the growing geopolitical tensions.
The Impact of Geopolitical Escalations on the Cryptocurrency Market
Since Russia invaded Ukraine and created a wedge between the country and the Western nations, Russians are transferring their wealth into Bitcoin. Experts are warning that Kremlin might also follow to same to evade US sanctions against the country.
The US and UK are trying to cut Russia off from international financial flows. Already, Russian banks have been excluded from SWIFT, an international payment system. Since Russian banks can’t send or receive money from international banks or convert it to dollars or euros, they are looking for other options to stabilize the Rouble’s value and continue international business.
One is by using the Chinese Yuan as a currency to trade overseas and the other is to convert the assets to cryptocurrency and use it abroad. If they opt for the latter, Moscow could resort to selling the nation’s vast mineral wealth against Bitcoin instead of the dollar. But cryptocurrency experts are opining that the market is lacking the liquidity to do so.
On the other hand, Bitcoin’s price is gaining value measured in Rubles. The value of the Ruble in contrast with the US dollar has gone down drastically, leading Bitcoin to gain ground in Russia. The demand is heavily coming from wealthy Russians and regular citizens trying to convert their money to cryptocurrency.
What Does Long-Term Price Analysis Suggest?
According to long-term Bitcoin price analysis, the cryptocurrency might find liquidity above the US$46k area. Since BTC is facing pressure to perform well and the factors are also coming in favor of the cryptocurrency, it might see a price surge in March and further.
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