Bitcoin Analysis: IS Bitcoin Bullish Run Over

For several weeks now, Bitcoin has generated expectations in the global financial markets. Amid a bullish rally, the cryptocurrency exceeded $12,000 which was partly due to the global trade and political tensions that redirected capitals from around the world to Bitcoin.

Although some financial analysts do not agree with this, Bitcoin is slowly occupying a position among the major assets considered worldwide as a monetary reserve value.

This is because the market value of Bitcoin does not correlate with world conflicts or government policies, unlike other assets. With this knowledge, investors are assured that geopolitical conflicts will not affect the price of Bitcoin.

Trade War Between China and USA Saw a Surge In Bitcoin Price

This was evident in the recent upsurge of the trade war between the United States and China. Some weeks ago Bitcoin became the refuge for investment capitals across the world after the Chinese Yuan depreciated against the dollar.

The depreciation  which came as a surprise to many was an attempt by the Chinese government to maintain the competitiveness of its exports against rising American tarrifs on its products.

Actions like these raise expectations in the market and showcases how countries are able to manipulate their currencies via central banks. These policies have different implication for the economy and would increase inflation thereby reducing the value of capital assets backed with fiat currencies.

It is no surprise that investors would move their investment into strong assets such as gold and Bitcoin.

Bitcoin Bullish Rally Has Reached a Moment Of Calm

Despite the initial surge of the coin to $12k during the depreciation of the Yuan, the price of Bitcoin has fallen to within the $11k region. As at the time of writing Bitcoin currently trades for $11,364.  Bitcoin is still far from the $12,000 mark which has been touted by many analysts as the resistance point for the coin.

Altcoins Affected By Current Market Trend

The fall in the price of Bitcoin has affected most altcoins in the market which is understandable given its dominance of 68.6%. Ethereum appears to be one of the most important altcoins to have felt the hit.

The second largest cryptocurrency by market capitalization suffered a drop of over 2% of its value, reaching $207.91 per unit. However, ETH has recovered like Bitcoin and currently trades at $212.27 per unit.

Bitcoin Could Be Set For Extended Bullish Run In The Coming Days

The current movements in the cryptocurrency market do not mean that the last Bitcoin rally has come to an end. This is far from true as Bitcoin has the tendency to go through this sort of trends.

What it means is that the initial wave of bullish run which was influenced by geopolitical events has reached a stumbling block.

The next few days will be important as it will give a better indication of which direction the market is leaning towards.

However, a trend has been established that despite having a modest capitalization $296 billion when compared to other financial markets. Cryptocurrencies will continue to thrive due to its largely decentralized nature.