Bitcoin has been trading sideways for the past three months, mostly between $9,000 and $10,000 without any major breakouts except the one on June 1 when Bitcoin managed to climb above $10,000 for a few hours.
Today, Bitcoin has surged towards $9,437 on Binance after the European Union announced an unprecedented €750 billion stimulus package aimed at helping several countries like Spain which was affected heavily by the pandemic.
In essence, cryptocurrencies are not directly affected by the stimulus package but as we have seen during the entire pandemic, Bitcoin can become heavily correlated with the global stock market.
While Bitcoin shouldn’t be affected by this event, it was and it cracked several resistance levels.
Bitcoin Price Analysis: Daily Chart
The momentum has heavily shifted in favor of the bulls after climbing above both the 12-EMA and the 26-EMA which are on the verge of a bull cross for the first time since June 21. The notable bull move also had a lot of trading volume behind it and made the MACD flipped bullishly.
The next resistance level to beat is located at $9,470 and would confirm a daily uptrend. More resistance can be found at $9,780 and of course, the area between $10,000 and $10,500.
After several rejections from this crucial area, Bitcoin is more likely to crack it in the next rally. This small breakout could be the beginning of Bitcoin’s bull run towards $20,000 again.
Will Coronavirus Halt Bitcoin’s Run Again?
At the same time, fears about another global lockdown are still in the air. Bitcoin and the entire crypto market are still correlated with the SP 500 and really the global stock market. Another lockdown could mean another crash for Bitcoin, however, at the same time, it could actually mean a pump.
It’s important to note that people are not so happy with the current economic system and fiat currencies. A lot of investors are looking for alternatives and cryptos are definitely appealing.
The next time, Bitcoin could really act as a safe-haven and not lose value but actually surge. Regardless of what happens, the long-term for Bitcoin is still bullish as fundamental metrics strengthen.
Grayscale, one of the most popular and biggest cryptocurrency trust funds has been buying Bitcoin at an unprecedented rate. Throughout 2020, Grayscale bought more than $20,000 Bitcoin and will own 3% of the entire Bitcoin’s supply by the end of 2020 if it continues buying at this rate.
In fact, if we consider that a few million Bitcoins are gone forever, Grayscale will own even more.