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Crypto market and coronavirus: March results
How Does Corona Virus Impact Cryptocurrencies?—David Stancel
Current market situation
The cryptocurrency market continues «storm» and in the last the week of March, the bitcoin rate fluctuated in the range of $ 5900- $ 6760. The coin reached $ 6,800 for the first time in recent weeks, but then slowly rolled back to the $ 6,700 level.
Several factors influenced the strengthening of the position of a digital asset:
- technical, judging by the daily charts, BTC is entering a phase of growth in value, and the bearish trend will gradually change to bullish;
- market, an increase in investor interest in cryptocurrencies in general, and bitcoin in particular, and also slight increase in customer activity.
If we analyze the movement of the course, then can note the increased demand from retail investors, who, taking advantage of the moment, purchase the coin at discounted prices on the eve of the halving. At this moment it cannot be said that institutional market participants are now actively buying up cryptoassets.
While digital currencies remain still quite volatile, but Today there has been a tendency when even large players are looking closely at cryptocurrencies and are beginning to consider the possibility of investing in them. Amid falling traditional markets and possible hyperinflation, digital assets may be used in quality alternative investment instrument.
Impact of the coronavirus
If we talk about March as a whole, then this month turned out to be the most difficult for the crypto market from the beginning of the year. Coronavirus epidemic, which covered the whole world and led to a fall in stock, commodity and foreign exchange markets, pretty battered and did not bypass the crypto market. Bitcoin sank to a low of $ 3,800 in March, but already by the end of the month was able to recover almost half of the lost value.
The decline in the price of MTC has a negative impact on altcoins. because of mass sale, the decentralized finance market experienced a real shock: users began to massively withdraw assets, which led to a lack of liquidity and many positions had to be liquidated.
Bitcoin remains the main driver for altcoins, respectively they repeated the downtrend. Despite the current signs of recovery, the picture of growth for them is rather vague..
In April, the world as a whole is predicted to worsen the economic situation. First of all, the OPEC + agreement is likely to cease to operate, which means the price of oil can sink even lower. In parallel, the epidemic of coronavirus infection will come closer to your peak. All this is will lead to a further decline in the global economy and, as a result, affect the cryptocurrency market.
MTC is still clearly correlated with index S&P500, which reflects the general market sentiment, but it continues to fall. Today the price of the main cryptocurrency has reached the $ 6,900 mark. And although Bitcoin has recovered almost half of its value since the last large-scale fall, the rate remains enough volatile and possibly, further also will be there are periodic declines. but, as we can see, military-technical cooperation has serious potential for further growth.
As for altcoins, their market behavior directly depends on the rate of the main cryptocurrency. – bitcoin. Over the course of the week, the leading altcoins rose and fell in the 3-5% range. This the market is still very volatile and volatile. Although American analysts believe that in the near future time top altcoins will strengthen in price against the BTC and the dollar, Yuri Mazur does not share their point of view:
«The altcoin market in Russia remains weak, and I still do not see any really promising and strong projects, except for ETH and XRP».
As for the forecasts, there is no need to wait for global changes in the market. Until the panic stops and the global economy begins to recover, there is no need to wait for an increase in cryptocurrency prices. More likely Total, MTC price will be fluctuate between $ 6600 – $ 6900, until will be able confidently overcome the $ 7000 resistance level.
text: Yuri Mazur, Head of Data Analysis Department, CEX.IO Broker, a photo: iStock, Shutterstock