Anticipated Bitcoin Stability: Volatility Forecasted to Minimize
Crypto Insiders Shed Doubt on Swift BTC Upturn, Anticipate Longer Bout of Stagnation
Oh boy, looks like the experts over at CryptoQuant aren't so optimistic about a swift comeback for Bitcoin (BTC). They're predicting a lengthy spell of stagnation instead. Why, you ask? Let me ‘splain!
Yonsei_dent, our trusty Contributor, is pointing out that the realized price of short-term holders is narrowing down. In other words, recent buyers are aligning their average entry prices, which could suggest waning demand or uncertainty with price movements. Yikes!
Moving averages with periods of 60 and 200 days are also converging, much like they did back in May 2024. After that, all hell froze over – the market entered a low-volatility phase, causing a market consolidation. If there's no demand catalyst anytime soon, we might be in for a repeat performance.
Now, let's talk about the elephant in the room. The Trump administration is set to discuss cryptocurrencies at a summit on March 7, and analysts believe we might witness some important regulatory announcements coming out of that. If the news is favorable, we'll see some market momentum for sure.
Woominkyu, our trusty analyst, chimes in by sharing that the Fear Index hasn't entered the "Optimism" zone just yet. Historically, when it does, we're in for a major BTC rally. But, hold on, the "Euphoria" stage triggers an overheated market, and that usually leads to some corrections.
Meanwhile, F2Pool co-founder Shen Yu ties the anticipated new bull run to the prospects of a US bitcoin reserve.
Now, what about the Trump administration's stance on cryptocurrencies, you ask? Well, they've alleviated regulations, promoted crypto growth, and even dismissed lawsuits related to cryptos. That's helping Bitcoin gain legitimacy, draw in institutional and individual investors, and even reduce legal risks for operating companies.
But, here's the catch: policy specifics remain unclear, and the administration's political influence might hamper regulatory clarity due to opposition. And don't forget about the inherent volatility of cryptocurrencies, which remains a huge risk factor even with the positive political support.
So there you have it, folks. The Bitcoin market's future may be brighter with the Trump administration's supportive stance, but there are challenges to navigate on the path to clarity. Keep your eyes peeled for updates from the upcoming cryptosummit on March 7!
Despite the anticipation of regulatory announcements from the Trump administration's summit on March 7, the stagnation of Bitcoin (BTC) could continue due to the narrowing realized price of short-term holders and the convergence of moving averages, potentially leading to another phase of low volatility like in May 2024. On the other hand, increasing finance and investing interest in the technology of Bitcoin, coupled with the administration's support for cryptocurrencies, could stimulate its long-term growth.
