5 things to consider about Bitcoin when 2020 ends

Bitcoin (BTC) had a week like no other, hitting a new record high of $ 28,400 and stay close to the top what’s next

As the markets are digesting a wild Christmas again, Cointelegraph presents five factors that will help guide Bitcoin prices this week.

Gold rises as Trump signals bullish stimulus

Markets were spared a nightmare this week after U.S. President Donald Trump agreed to sign the $ 900 billion stimulus bill. Congress for the Coronavirus.

5 things to consider about Bitcoin when 2020 ends
5 things to consider about Bitcoin when 2020 ends

Ready to add a large amount of debt to the existing mountain of the Federal Reserve, The package includes several business benefits, but it doesn’t offer Americans the same direct financial support it did in March.

Trump had said that The second stimulus’ low direct payment amount of $ 600 versus $ 1,200 last time meant he couldn’t approve itbut later changed his mind.

In order to, The markets have started a new week on a positive note, with slight gains in the SP 500 futures ahead of the Wall Street opening..

At the same time, Gold is back in fashion. Data shows the precious metal is now well on the way to making its biggest one-year gain in ten years.

Looking towards the end of November XAU / USD is up $ 111, or 6.25%.

The daily XAU / USD candlestick chart. Source: TradingView

“President @realDonaldTrump vetoed just nine bills, the least since Warren Harding, who only served two years from 1921 to 1923“, tweeted Peter Schiff, gold beetle and notorious Bitcoin naysayer, while the bill was being signed.

“Ever since Chester Arthur (1881-1885) had a full term president, he hasn’t vetoed fewer bills. You cannot drain the swamp by deepening it. “

The regulations for bitcoin

After we hit a new pitch with a wider audience over Christmas and hit new highs, Bitcoin could soon be under pressure from the authorities, sources warn.

With a price of $ 28,400 and a monthly profit cap of 55% Bitcoin is now firmly on regulators’ radar as its appeal grows. Even for its proponents, the coming year could be a difficult time.

Treasury Secretary Steven Mnuchin is making a name for himself trying to impose new laws on unguarded pursesand they say their replacement, Janet Yellen, may not be an improvement.

“In general I think so We had challenges with the Democrats, they prefer more regulation, more oversight, “said Meltem Demirors, Chief Strategy Officer at the digital asset manager CoinShares, on Sunday at Bloomberg.

“I’m a little concerned about the direction things are going.”

As always in the United States The mosaic of political loyalty means that any attack can be mitigated by the presence of people from the world of cryptocurrencies elsewhere. The new chairman of the Securities and Exchange Commission (SEC), Elad Roisman, is considered a fanatic

Analyst: Bitcoin correction after $ 28,400 is “very healthy”.

Focus on the latest Bitcoin spot market action, Monday will be a big test for the bulls given the momentum over the weekend.

After hitting an all-time high of $ 28,400 on Sunday, Bitcoin saw a pullback that many were expecting.

“Bitcoin has taken a very healthy correction as it was pretty vertical. It could be the temporary high point for now.”, summarized Cointelegraph market analyst Michaël van de Poppe on social media.

“What’s next? Consolidation, side effect, less volatility. Give the rest of the markets room to pick up the pace. BTC pairs are fine.”

Hourly candlestick chart for BTC / USD. Source: TradingView

Van de Poppe examines and argues the potential of altcoins to begin his reaction to Bitcoin’s recent successes There are already signs that the “old season” is just around the corner.

“After Bitcoin ends the rally (and it’s pretty vertical), money goes into the big caps. And then into the medium and small caps.”he went on.

“Altcoins are not dead, the flow of money stays the same.”

As they sway against BTC Some popular altcoins still deliver significant returns in US dollars. Market leader Ether (ETH) is trading over USD 700 for the first time since May 2018. From the lows of USD 113 in March, ETH / USD is up 530%.

ETH and BTC performance vs. USD YTD. Source: Digital Assets Data

Record Bitcoin Futures Gap

Bitcoin has the biggest void in the futures markets this week.

CME Group’s futures data shows that On Friday, trading ended at around $ 23,825. Monday started with a wick at lows of $ 26,500 from the opening levelHence, the difference is rated as the greatest ever seen in a weekend.

These so-called “gaps” of futures refer to the gap between trading sessions on Friday and Monday, and the spot rate of BTC / USD has a habit of “filling” it again later.

However, this trend has weakened in recent weeks; has been Gaps between $ 16,900 and $ 19,500 that were only partially closed.

This in turn has given rise to theories among analystsincluding Van de Poppe from Cointelegraph, that Bitcoin could still reverse its downtrend, to return to below $ 20,000 levels long enough to worry about its unfinished business.

Otherwise, analysts may have to accept the loss of a previously strong indicator of short-term Bitcoin price action..

CME Bitcoin futures chart shows the gap. Source: TradingView

Stock to flow predicts the maximum

On the subject of price development, Bitcoin’s latest promotion puts one of the most famous and reliable pricing models to the test: Stock to Flow.

After achieving exactly what the model requested last week, The weekend caused BTC / USD to outperform. Sunday’s retreat to the mid-range of $ 26,000 ensured compliance returned quickly.

As pointed out by both its creator PlanB and Saifedean Ammous, author of “The Bitcoin Standard”, Bitcoin generally remains very faithful to what the flow of stocks requires almost daily.

“”Bitcoin price continues to follow the predicted value of the @ 100trillionUSD stock flow model with amazing precision“, summarized Ammous.

Bitcoin stock on flowchart. Source: digital

In the future, The various incarnations of the model call for price levels between $ 100,000 and $ 576,000 from now until the end of the current halving cycle in 2024.

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