Analytics / Forex and Crypto News
The news that Tesla will sell its electric cars for Bitcoin has had a temporary impact on the market. The BTC/USD pair hit a high of $57207 but has dropped to the area of $50500 by this afternoon. And at the time of publication, the BTC/USD is trading at around $51500.
Analysts say the current decline was expected as volatility eased to a four-month low. The pullback was also triggered by profit-taking by investors.
However, it should be noted that the US dollar began to strengthen thanks to positive data on economic recovery after the pandemic.
Data on US GDP in the 4th quarter of last year turned out to be better than the forecast, 4,3% against the forecast of 4,1%. Also, the data on the number of initial jobless claims benefits came out below the forecast, 684K against the forecast of 730K. This demonstrates that the US economy is recovering from the pandemic faster than expected.
Stimulating the economy has shown its results. Statistics showed that people began to spend more on restaurants, gyms, hotels, etc. The rise in consumer spending has spurred the creation of new jobs and a decrease in the number of initial claims. In addition, active vaccination of the population has a positive effect on the mood of citizens.
As a result of the strengthening of the dollar, the yield on US bonds decreased. Accordingly, investors began to rebalance their investment portfolios.
Analysts say Bitcoin is entering a period of uncertainty in the current environment. Rising inflation and depreciation of the US dollar will make cryptocurrency attractive to investors.
As a result of the decline, the price of Bitcoin dropped below the 50th moving average. And if the BTC/USD pair falls below the $50000 level, it may drop to the area of $44000.