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Bitcoin Price to Surge Above $11K or to Drop Below $10K? Factors that Could Affect BTC's Next Move

Yesterday, Bitcoin surged to its daily high of $10,930 and abruptly corrected after it hit the 30-day moving average, which has been a strong resistance level since Aug. 25.

A bipartisan stimulus plan was announced yesterday in the US, indicating the potential for more liquidity in the market which could be bullish for asset prices. This news overlapped with the positive news of the resumption of the AstraZeneca vaccines the day before. Both the Dow and Nasdaq opened high, but at its close, the Dow was only up by 0.01%.

The Apple stock opened high at a 2.13% increase stimulated by the release of a series of new products. However, the tech stock only gained 0.16% at its daily close. An hour after trading closed, the price dropped by 0.67%. The whole market emotion is still prudent. The recent news of a stimulus package and the state of the stock market could both have an influence on the Bitcoin and crypto market as well.

Apart from the recent stimulus package news, MicroStrategy bought 16,796 Bitcoins (BTC) for $175 million on top of its existing 21,454 BTC. MicroStrategy now holds 38,250 Bitcoins with an aggregate purchase price of $425 million. The average Bitcoin price is of the firm’s entire purchase is $11,111 per BTC.

While the news came out that MicroStrategy purchased more Bitcoin, BTC’s price started to retrace to $10,606, its daily low.

Source: TradingView, Bitcoin price chart

The price fluctuated under the 30-day moving average (MA) and is looking to challenge the 30-day moving average again. The stock market and other cryptos, including the SUSHI token, Ethereum, and Polkadot—could be indicators of Bitcoin’s next move.

Source: Binance, SUSHI Token price chart

The Sushiswap (SUSHI) token price recently plunged again by more than 23%, to around $ 1.70. The Ethereum has been presenting even weaker gains than Bitcoin. The 90-day MA is a strong support level for Ethereum, but it is apparent that the 30-day MA is a strong resistance level, the Ether price even did not touch that level since the crypto market crash.

Source: TradingView, Ethereum price chart

Although the Bitcoin’s price is promising in the long run, as backed by many experts, there are no huge incentives for it to reach its previous high in the short term. Bitcoin’s price could continue to fluctuate between $10,000 and $11,000. The overall crypto market seems to be on a bearish moment, while Ethereum’s price could plunge again which could pull down Bitcoin’s price as well. Factors like the new economic stimulus plan, vaccine news, SUSHI token price trend, Ethereum price trend, new regulations could have an influence on Bitcoin’s price, which is worth paying attention to.

With additional reporting by Kun Hu.

Square Stocks Soar After Bitcoin Purchase, Market Bulls Convinced PayPal Will Make a BTC Move of Its Own

Square’s $50 million-dollar move on Bitcoin has pushed the fintech payment company’s stocks higher, enabling it to outperform PayPal shares.

Square bullish on Bitcoin

Square, a mobile payment company founded by Twitter CEO and Bitcoin pioneer Jack Dorsey, recently announced that it purchased 4,709 Bitcoins (BTC). The new addition translates to 1% of the firm’s total reserve assets. The announcement spurred great excitement in the Bitcoin (BTC) community, as Square has been very cryptocurrency-forward, even having a Bitcoin payments feature available on its Cash App.

Square stocks performed bullishly on the market after the news, as the financial company joined the growing number of firms that have invested in Bitcoin as a hedge this year.

BTC pioneers – PayPal to Jump on the Bitcoin train

Following Square’s new purchase, Bitcoin bulls have speculated that it was only a matter of time before Square’s industry rival, PayPal, followed suit and directed its attention towards BTC. In June, there had been talks that the digital payments company was considering rolling out cryptocurrency sales services for its 305 million users.

Author of “Why Buy Bitcoin” Andy Edstrom explained his logic by pointing to the fact that one of PayPal’s board members of 2016, Wences Casares, was no longer listed as part of the payments company’s executives. He explained that this could be indicative of the fact that PayPal was soon to make a move on Bitcoin, as Wences may have been in a conflict of interest with the payments giant, as he possessed Xapo – a Hong-Kong founded Bitcoin wallet that also had a cold storage option and a BTC-based debit card.

Edstrom said:

“Square stock is crushing PayPal stock. Square does #Bitcoin. PayPal doesn’t. Wences seems to have left the PayPal board. PayPal #Bitcoin service imminent?”

Estrom’s reasoning was backed by Galaxy Digital founder Mike Novogratz, who has long been reputed to be a Bitcoin whale. The blockchain and crypto company CEO echoed Estrom through a re-tweet. In reference to Paypal potentially launching a Bitcoin service, he said:

“It’s coming and will be the biggest news for $BTC in 2020. And it’s been a big news year. Just reading tea leaves here.”

2020 the year of Bitcoin

Bitcoin has achieved significant gains this year. Amidst the coronavirus pandemic, the mainstream cryptocurrency has recorded notable gains on the market, mainly due to the US Federal Reserve’s plans to push inflation above its traditional 2% target and the US dollar devaluating as a consequence of mass money printing to deliver stimulus packages.

With the depreciation of the US dollar, investors have flocked to Bitcoin, seeking it as a hedge investment and a store of value.

Bitcoin has currently surged past its resistance level of $11K, trading at the time of writing at $11,365 based on data from CoinGecko.

Investors See Bitcoin as a Long-Term Investment, says Crypto Analyst

Bitcoin’s consolidation continues after hitting a high of $58,300 a week ago as a looming pullback was imminent.

The leading cryptocurrency is trading at $47,424 at the time of writing, according to CoinMarketCap.

Despite the current price correction, veteran on-chain analyst Willy Woo has revealed that Bitcoin’s velocity is higher than that of funds allocated for spending it. He explained:

“Bitcoin’s monetary velocity is now higher than USD M1. M1 is the USD held in short-term accounts for buying stuff; none of it is moving. BTC’s making a joke out of it. BTC is moving more than the money we have for spending. Nevermind, BTC is for long-term investment.”

The analyst believes that this is a positive signal for BTC because it means that investors believe Bitcoin to be more of an investment vehicle meant for the long-term.

Selling pressure from BTC miners is subsiding

Bitcoin’s current pullback has been partly triggered by immense selling pressure from Bitcoin miners as they seek to cash in profits.

New data by Bloqport discloses that this pressure may be subsiding based on miners’ net position becoming positive. The crypto data provider noted:

“For the first time since late December of last year, Bitcoin miners’ net position change reverted back to positive, indicating miners selling pressure may subside.”

These statistics correlate with insights provided by on-chain metric provider Glassnode that miners have stopped selling as they are accumulating Bitcoins.

The fuel behind BTC’s uptrend has been due to overwhelming support from institutional investors and the rolling out of stimulus packages by global governments meant to bail out their economies from the grappling financial effects of the coronavirus (Covid-19) pandemic.

With the US government eyeing another stimulus package worth $1.9 trillion, time will tell whether this is another catalyst that will push Bitcoin’s price through the roof as it continues cementing its status as an inflationary hedge.

Bitcoin Back Above $50,000 As Senate Passes Biden's $1.9 Trillion Stimulus Package

Bitcoin (BTC) is starting the week on a stellar note as it is trading above the $50,000 resistance following the news that the United States Senate has passed President Joe Biden’s $1.9 trillion COVID-19 stimulus package.

At the time of writing, the cryptocurrency is trading at $50,759.63 at a daily gain of 2.56%, the highest over the weekend based on data pulled from CoinMarketCap.

Stimulus Packages and Bitcoin Price Surge

The rollout of stimulus packages has a track record of fueling Bitcoin’s price surge. The underlying economics is simple, as stimulus involves the printing of a lot of fiat currencies which increases the amount of money in circulation. Inflation comes with this increased circulation, reducing the purchasing power and the overall value of the fiat currency, in this case, the US Dollar.

Citizens and businesses alike will not want to get caught up in the devaluation of the Dollar over time and are thus poised to explore options to help protect their holdings. This is where gold and Bitcoin come into play. Although the claims are still being debated, the latter asset has gained increased adoption over the past year as the better store of value and hedge against inflation.

The stimulus package may also be used by some citizens to purchase Bitcoin, and we may see an increased inflow of funds into the digital assets as the stimulus cheques get delivered. Firms like MicroStrategy, who has a track record of strategically investing shareholder’s funds into Bitcoin, may also find new reasons to increase their overall stakes.

Proposed Influence on BTC

An inflow of funds into Bitcoin is bound to exponentially increase its price over time. The digital currency is already responding to this possibility with the growth it has picked up today. A target of $58,000, its previous all-time high is being projected in the coming weeks, and then, the cryptocurrency will be on track to hit new price levels by the end of the first quarter, 2021.

Most Americans Plan to Use $1,400 Stimulus Checks to Invest in Bitcoin and Stocks – Mizuho Survey

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Eligible Americans have begun receiving their $1,400 stimulus check following US President Joe Biden signing a 1.9 trillion COVID19 relief package into law last week.

According to survey data released by Mizuho Securities Co. Ltd., a significant amount of US citizens may be planning to spend almost 10% of the latest batch of direct stimulus checks on Bitcoin and stocks.

The research estimated that nearly $40 billion of the $380 billion given directly to Americans could be used to buy the two asset classes.

Mizuho investment and securities firm surveyed 235 people with household income less than $150,000, of which around 200 of the respondents stated that they would receive payments from the latest round of stimulus. Up to 40% of respondents said that they would invest the direct payments into stocks and Bitcoin while 61% said that they would choose Bitcoin over equities.

The company identified that almost two in five US citizens are expecting to use their handouts to do investments, and they are particularly planning to invest in stocks and Bitcoin.

According to Mizuho Financial Group, Bitcoin is expected to account for 60% of the total investment and the number of people investing could add as much as 3% to the crypto’s market value. Bitcoin is currently trading at $56,000 and has a market cap of over $1 trillion.

Mizuho identified a number of crypto-focused firms (such as Square, PayPal, Mastercard, and Visa) that are believed would benefit investors most should they wish to invest in cryptocurrency.

Bitcoin Going to Hit Higher

President Joe Biden signed the $1.9 trillion COVID-19 relief package into law last week on March 11, an incident that would see eligible Americans receive checks for $1,400. The first batch of stimulus checks was processed on Friday last week as several Americans have already started receiving the payments via direct deposits while others are waiting for the paper checks to arrive through the mail.

This is the third stimulus package designed to financially assist US citizens affected by income security during the coronavirus pandemic. US lawmakers approved the first stimulus package in April last year whereby individuals earning less than $75,000 per year received $1,200 per person. In January this year, President Trump approved the second round of stimulus payments that provided $600 checks to individuals.

Some market analysts have attributed Bitcoin’s tremendous growth to various factors relating to the COVID-19 pandemic, including a rising perception that it functions as a form of “digital gold” for investors during times of economic uncertainty. The third coronavirus-related package is set to boost Bitcoin’s price, similar to market movements following previous packages.

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