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The bulls are focused on Bitcoin

Bitcoin was clinging to $13,700 on Monday morning but due to increased turbulence in traditional markets, it began to give up positions. The monthly candle closed above $13K for the first time since December 2017 and at the end of last week, crypto market participants witnessed Bitcoin approaching $14K. This level was too strong a resistance, and sellers entered the game. However, they didn’t have enough strength to put significant pressure on the price.

The bulls are focused on Bitcoin

The U.S. stock indices did not perform well in the pre-election week, which is not the case for Bitcoin. The first crypto coin took market share away from the altcoin sector, with Bitcoin’s dominance index rising by more than 2 points to 63% over the week. The market is now frozen in anticipation of any certainty regarding the U.S. elections. This factor may not only be a growth constraint but it also has potential for correction of the first cryptocurrency.

There are several potentially dangerous scenarios: election results will be challenged by one of the candidates for some reason and/or mass protests will start in the country. In case investors start heavy selling the stock market, which is already being kept afloat only through incentives, we may well see a sharp sale of Bitcoin. In March 2020, against the backdrop of the pandemic, Bitcoin dropped several times, but the coin quickly attracted buyers and is now more than 200% more expensive than the lows of the year.

Another positive factor for Bitcoin is the fact that the cryptocurrency is one step away from setting a new record: 100 days above $10,000. The fact is that, based on statistics, after passing this stage, the coin can show really impressive bullish dynamics. According to CoinMetrics, when Bitcoin has been trading above a round threshold for more than 100 days ($10, $100, $1000), the coin has serious growth prospects, although the period from $1K to $10K was quite long, taking 150 days. Nevertheless, combined with the probable unfolding of the halving potential and high interest from large capital, we could well see impressive growth in a shorter time.

There is no point in predicting the outcome of the election, while it is obvious that in case of a sharp decline of Bitcoin, a large number of buyers will enter the market, as they have long been waiting for the opportunity to buy at a reduced price. Whatever shocks the global economy may experience this week, one thing is clear: increased turbulence offers huge opportunities for profit, and investors are now facing somewhat of a “holiday season”.

The FxPro Analyst Team

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