InstaForex

August 16, 2021

The world is becoming more supportive of bitcoin, as it begins to understand its advantage over fiat money.

 Bitcoin continues to grow, and, as we have already said, this is most likely due to the rush of many investors and traders to have time to buy as many coins as possible before the new legislation concerning the taxation of cryptocurrencies is adopted in the United States. Also, we should not forget that the Fed, like many other central banks in the world, continues to stimulate the economy with hundreds of billions of dollars printed. Thus, there is more money, and they need to settle somewhere. For example, for this reason, US stock indices continue to grow and update their records almost every day. However, it should also be understood that the governments and central banks of many countries will continue to "tighten the screws" to the cryptocurrency segment. Thus, we still do not expect the quotes of "bitcoin" to return to the year's highs. We believe that the current growth of cryptocurrency is somewhat random due to a combination of circumstances. However, almost all the recent trends of "bitcoin" were in some way random. The main thing is something else. At this time, there is a very clear trend line on the 4-hour timeframe, which supports the growth of the digital asset. Therefore, whatever the fundamental background, the upward trend persists as long as the price is located above this trend line.


Meanwhile, the world is slowly beginning to understand the advantage of bitcoin over almost any fiat money. On the one hand, this fact lies on the surface: bitcoin, like any other cryptocurrency, is not subject to any central bank. Its issue is limited to 21 million coins, which means that it will not be subject to inflation, manipulation, or intervention by any Central Bank. On the other hand, this fact is not yet obvious to everyone. In addition, central banks still have the opportunity to influence bitcoin and its circulation through governments, which can tighten it or completely ban it. Thus, the whole world is still at a crossroads. On the one hand, bitcoin, in some moments, already looks much more attractive than ordinary money. On the other hand, it is still highly volatile, unstable, and the authorities of many countries may well ban it.


In technical terms, bitcoin grows on the 4-hour timeframe and has worked out the resistance level of $ 47,500. There is also an ascending trend line that supports the upward movement. Thus, until the price is fixed below this line, we do not recommend selling bitcoin. Although, from our point of view, there are still high chances of a new drop in the quotes of the main cryptocurrency up to the level of $ 29,700.