Technical Analysis of BTC/USD for May 8, 2020

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Crypto Industry News:

It seems that Bitcoin has again started to stand out from traditional markets, as investors have again focused on the upcoming halving. While, the highest cryptocurrency in market value, it has gained almost 5.9% so far this month, while gold has fallen by 1%. Meanwhile, on Wednesday the S&P 500, the Wall Street stock index fell 2.2% against one month.

Bitcoin is also the best-selling asset, with a 28% increase over the previous year. Oil (WTI) recorded a correction of 66%, which is due to the huge drop in demand caused by the coronavirus pandemic.

Over the past two months, Bitcoin has been moving mainly in tandem with the stock markets. Its value dropped from $ 10,000 to $ 3,867 in the first two weeks of March, because the sale of global shares due to a coronavirus pandemic sparked a global cash spike. The cryptocurrency has risen above $ 7,000 over the next four weeks.

However, positive correlation weakened last week when Bitcoin recorded double-digit earnings, despite moderate share losses. At the time of writing, the cryptocurrency value is currently $ 9,300, a 4.4% increase over the week.

It seems that the situation on the cryptocurrency market has changed the stimulus from coronavirus to halving, which is expected to come into force on May 12 (though this may happen earlier). The supply change process and the recent increase in value from $ 7,600 to $ 10,000 could have been fueled by the fear of losing expected profits.

The Bitcoin network is also experiencing its busiest period for over two years. For example, the average of seven days the number of unique active addresses on the network increased on Wednesday to 947.088, which is why it reached its highest level since January 2018, according to data from Glassnode. This jump suggests an increase in investor interest in cryptocurrency.

Technical Market Outlook:

The BTC/USD pair has hit the level of $10,000 as anticipated and currently the market is consolidating the recent gains. The is only three days to halving, so the price might extend the gains towards the level of $10,248 – $10,430. Still the key level of support is still seen at $8,357, but the nearest technical support is currently seen at the level of $9,704. Any violation of this level will deepen the correction towards the level of $7,934 which is a key short-term technical support for the price. Weak and negative momentum supports the short-term bearish outlook.

Weekly Pivot Points:

WR3 – $11,425

WR2 – $10,480

WR1 – $9,720

Weekly Pivot – $8,578

WS1 – $7,824

WS2 – $6,750

WS3 – $5,970

Trading Recommendations:

The recent rally in Bitcoin was made in anticipation of Bitcoin halving and it is a classic pump and dump scheme. The larger time frame trend remains down and as long as the level of $10,791 is not violated, all rallies will be treated as a counter-trend corrective moves. This is why the short positions are now more preferred until the level of $10,791 is clearly violated.

The material has been provided by InstaForex Company – www.instaforex.com

Source:: Technical Analysis of BTC/USD for 08/05/2020:

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