The US government’s continued shutdown has removed entrepreneurs of the latest data release to economic, which inject a sense of uncertainty in the markets. In these situations, it is advisable to look back at how markets have reacted to past shutdowns.
Noteworthy, the US government’s past shutdown, which lasted since late December 2018 to January 2019, coincided with the process of declining the Bitcoin market that opened in late 2018 and early 2019.
Here’s how it played: the previous shutdown lasted 35 days between December 22, 2018 and January 25, 2019. Bitcoin fell from around $ 6,000 in mid-November 2018 to more than $ 3,000 in December, marked the final capitulation event.
The week starting on December 17 marked the bottom, with a BTC price that hit its lowest point, before beginning with a strong recovery that saw seven consecutive green weeks between February and April, following the opening of the US government, pushing prices over $ 5,000.
Note that the timing of the bottom of the market does not necessarily indicate that the previous government’s shutdown and subsequent opening played a direct role in Bitcoin’s Bearish to bullish the change. Moreover, since the latest shutdown began, Bitcoin refused more than 1%, consistent with Swoon on Wall Street, where the tech-heavy Nasdaq index dropped by 1%.
That said, the question remains whether BTC will follow the 2018 analog and ride at a new rally. It will be predicted by anyone, but the recent flush-out of excessive action, in conjunction with the hope for Fed rate cuts, can provide a healthier foundation for the new leg higher.
Resetting Leverage
On Friday, the Biggest extermination event In the history of crypto has taken place, taking a total of $ 20 billion in leveraged futures stake tied to Bitcoin, Ether and the wider Altcoin market.
BTC prices are crashed up to less than $ 107,000 in Coinbase, along with other recording exchanges even lower levels. The $ 107,000 Mark has been the lowest price of Bitcoin since July.
Coinmetrics described the event as the stress event left in the market in a healthier state.
“Ultimately, good-leveraging is a stress event rather than a systematic failure. While interrupting, it has helped to seize excessive action and leave the market on a healthy walk,” the company told its weekly newsletter.
Gold offers bullish cues
Another factor that supports the bullish case in BTC is the uninterrupted gold rally, which is widely considered an inflation hedge and a safe property.
The yellow metal exceeds 4,200 per ounce price for the first time, rising 61% year-to-date and 10% since the shutdown began. Other precious metals such as silver, palladium, platinum are also torn.
Data displays That bitcoin is usually gold folows higher, with its own BTC appreciation that usually begins after gold rally stalls.
Analyst’s note Joe Consorti usually leaves Bitcoin’s gold Almost 100 daysand based on jThe model fair amount of volatility that PMOrgan suits Comparing Bitcoin to gold, it will indicate a bitcoin price of nearly $ 165,000 by the end of the year.
