Mercados al día is an exclusive summary of the news that moves the bitcoiner economy. It is sent in advance by email to a list of subscribers and then published every Monday in CriptoNoticias. If you want to have the information in advance, subscribe to the list here.
For the first time since the beginning of 2018, a bearish streak in the price of bitcoin (BTC) of more than four weeks has materialized. From last Saturday, March 30, to this Sunday, May 1, there were five consecutive weekly red candles, resulting in a price retracement of 17.4%. The BTC price drop in April returns bitcoin to late January levels, which reverses the ground gained from the February and March rally.
However, bitcoin is still within a growing trend of its floor, in recent weeks, as reported by CriptoNoticias. This has been the case since an annual minimum of USD 32,900 was registered in the price of this cryptocurrency on June 24. At the time of writing, bitcoin is trading at $37,730 and has hovered in a range between $37,000 and $42,000 for three weeks.
Extreme fear does not prevent bullish positions
Coinciding with the downward trend that has been maintained since last March 28, when the price of BTC reached its maximum of this year of USD 48,000, bitcoin’s Fear and Greed index has been moving into the “extreme fear” area. However, as we reported in this medium, the growing demand and the bullish sentiment of some analysts lead us to think of an imminent bull run in the price.
This price decline, while it may scare investors into selling, does not necessarily discourage traders who have already accumulated bitcoin. According to several analysts of the bitcoin market, these traders think “that bitcoin is very cheap”.
As can be seen in the Glassnode graph, BTC in addresses with more than 1,000 BTC have increased markedly in recent days. Which implies that the whales, as these wealthy are called in bitcoin, are buying.
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Is bitcoin a bubble?
An economic bubble is defined as the unusual increase in the price of an asset, without there being technical or intrinsic value fundamentals of the asset to support that increase. CriptoNoticias spoke with the financial analyst Henkel García and with the cryptocurrency expert economist Aarón Olmos, about the possibility that bitcoin is a bubble.
The graph contrasts the growth of bitcoin, which has had cycles with significant corrections, with the most notable historical bubbles. CriptoNoticias had already analyzed the most important corrections of bitcoin, and from that analysis it follows that the magnitude of the price drop in each correction is getting smaller and smaller.
Featured chart of the week
When bitcoin began to be examined as a real investment alternative to traditional assets, the low correlation of BTC with traditional assets was highlighted. This situation has changed, as the correlation of bitcoin with leading stock market indices such as the S&P 500 or Nasdaq has been increasing since 2021. However, the return of bitcoin in the medium and long term leaves these important stock indices far behind.
This chart provides a comprehensive comparison of bitcoin’s performance against traditional assets, but it is not limited to the S&P 500 or other prominent assets, but includes assets from various industries and sectors. Who has better performance? The graph speaks volumes, and the comment from its publisher, bitcoiner Preston Pysh, says something else: “How deep does he have to bury his head in the sand to NOT see this graph?” The original author of the graph is also well known: Fidelity Investments.
Bitcoin Proposed in US Retirement Plans
Fidelity, the largest provider of investment plans for retirees in the United States, announced last Tuesday the 26th that would allow its clients to put a part of the money destined for retirement funds in bitcoin. Fidelity’s initiative, which was commented by this means, would imply a significant increase in the adoption of bitcoin, since this company manages more than USD 2.4 billion dollars in retirement plans for more than 23 thousand companies, as reported CryptoNews. Exposure to bitcoin could then reach millions of retirees in the US.