Bitcoin (BTC) is starting a new week in an uncertain territory as $ 10,000 remains in place but is mainly turning towards bulls.
Cointelegraph highlights five things that could influence BTC’s price movement in the next few days.
It was the highest oil demand in 2019
In a statement likely to be much quoted, the oil giant BP said over the weekend that the world had met its highest demand for black gold.
In a report cited by Bloomberg, BP said that oil demand would remain “largely unchanged” over the next 20 years under pressure from alternative fuels and the coronavirus.
“It will recover later, but it will never return to pre-Covid levels,” said Spencer Dell, the company’s chief economist.
This helps to reach peak oil demand by 2019. ”
The exciting acceptance came as another surprise to the global economy, as central banks acknowledged that unconventional monetary policy had become the norm in 2020.
With Coronavirus at the helm and at least one country in lockdown on Monday, Bitcoin appears to continue to benefit from weak oil and fiat currencies.
As Cointelegraph reported, previous extreme swings in the prices of some oil assets have allowed BTC to act as a hedge against losses.
The game has undergone another amendment by the Federal Reserve
Another week, another meeting of the US Federal Reserve – and a chance for a safe haven to take advantage of the political shifts.
On Wednesday, the Fed will describe how it plans to implement economic measures that will affect inflation – something that has previously caused the dollar to weaken.
“Maintaining the political status quo in this context would be akin to throwing a towel that would undermine the credibility of the new structure immediately,” Jefferies Chief Financial Officer Aneta Markowska told MarketWatch on Monday.
Any action from the Fed could once again affect the US Dollar Currency Index (DXY), which has shown Bitcoin a major reversal correlation since July.
Analysts said gold markets are already assessing the possibility of a change and are betting that the Fed will take an increasingly tough stance. The precious metal formed a “golden triangle” and is ready to explode.
As for Bitcoin, it’s all about DXY – a reversal of the recent gains in early September would be a clear signal of will. On the contrary, continued gains are likely to maintain selling pressure at $ 10,500.
Meanwhile, Steve Barrow, head of monetary strategy at Standard Bank, told Bloomberg: “The coronavirus crisis is many times more devastating than the 2008 financial crisis.”
“There is every reason to believe that the transition to a tighter monetary policy will take a lot – and possibly much longer – than the post-financial crisis period.”
A strange new standard for central banks
Regarding central bank policy, this year there will be a major shift in oil demand.
Since Bitcoin is the antidote to a central bank mixed with the money supply, further devaluation of the fiat currency is only encouraged by BTC representatives who wish to hedge.
“The world’s central bank leaders are finding that monetary policy, which they once considered unconventional and temporary, is now conventional and long-term,” Bloomberg said of the global situation.
According to the post, in 2020, major central banks will use anti-crisis policies that they have not used before.
Since RT host Max Keizer often comments on his show The Keizer Report, nothing is more permanent than the central bank’s interim fiscal policy.
Bitcoin fragmentation is at an all-time high
However, the future inside Bitcoin is clearly bright. The hash rate – an indicator of how much computing power miners have decided to devote to verifying transactions – has reached another all-time high.
On Monday, Blockchain data shows that the average hash rate over seven days was 135 downloads per second (EH / s).
The hash rate reinforces miners’ belief in Bitcoin’s long-term profitability. Hardship, arguably the most important goal of blockchain health, is set to rise 5.4% this week, also leading to record growth.
Commenting on the overall situation, Michael Van de Pope, an analyst at Cointelegraph Markets, suggested that scaling back is all it takes to keep Bitcoin going.
“If you want to compare periods and market cycles, the current market situation is comparable to 2016,” he wrote on Monday.