Bitcoin Correction Is Not Over Yet

Recent statement by President Trump saying that he wants the US open for business by Easter sparked some life into markets and we saw the S&P 500 (SPX) make one of the biggest single day leaps of the year and the same was seen across other markets. Gold (XAU/USD) rallied hard and we saw the cryptocurrency market capitalize on this opportunity as well. The question now is, “Is this sustainable?” In my opinion, this is not sustainable and we might soon see the correction begin both in the equities and commodities markets as well as the cryptocurrency market.

The price of Bitcoin did end up breaking out of the pennant in a sideways manner. Also, as we expected, it made a false move to the upside which was soon erased and the price now seems ready to decline lower from here. The most probable scenario at this point would be for the market would be to decline before the end of the month and potentially take out the previous low at $3.8k. This would be a bearish development near-term but it could prepare the market for a rally around halving. This current move in the stock market as well as the cryptocurrency market is not complete yet but after it comes to completion, we could see positive events like a cure or solution for the Coronavirus even if temporary.

There is no denying that the world will never be the same after this. Industries like tourism and hospitality will see major changes. The same goes for the future of work. This is bigger than 9/11 in terms of the impact it is going to have. However, we will recover from this at some point but things would be different and this also applies to investors’ approach to financial markets.

The days of investors putting their money into just anything is gone in my opinion. This is why I think a lot of these useless altcoins may not make it to the next market cycle. For now, there is plenty of fear in the market even though the recent bullish moves have sparked some interest. However, the fact remains that we do not know where the floor is and both the cryptocurrency market as well as the stock market are primed for another decline from current levels. WTI Crude Oil (USOIL) presents a good picture as to what we could expect next. As long as this bearish momentum remains intact, we can expect further downside.