Bitcoin’s price action as of late has been driven by a combination of recent news developments, jitters within the macro-economic environment, as well as technical weakness.
That being said, these factors have not been enough to push the benchmark cryptocurrency below any crucial support levels, as it is still trading within the macro trading range that it has been caught within throughout the past few weeks.
Until this range is firmly broken below, the cryptocurrency’s mid-term outlook remains strong, and its strength in the face of bear-favoring news is surprising.
One on-chain analyst is now noting that the crypto market is “scared for all the wrong reasons” at the present moment, noting that the recent news surrounding the CFTC’s BitMEX charges could actually incubate growth within the market.
He also notes that on-chain data is pointing to underlying strength, with Bitcoin seeing massive inflows of new capital from new investors.
The confluence of immense fear, overleveraged sell-side pressure, and fundamental strength could help lead the markets higher in the days and weeks ahead.
Bitcoin Price Stable Despite Plethora of Bear-Favoring News
At the time of writing, Bitcoin’s price is stable around $ 10,500, with bulls defending against any significant downside despite the multiple bear-favoring news developments.
Yesterday, the market reeled on news of BitMEX being pursued by the CFTC for violating multiple regulations.
The weakness stemming from this revelation was compounded once news was released regarding President Trump contracting the virus that has been hampering the global economy’s growth.
Despite these events both placing pressure on Bitcoin, the cryptocurrency has somehow been able to avoid seeing any type of capitulatory downturn.
On-Chain Analyst: Current Fears Regarding BTC are Misplaced
While speaking about Bitcoin’s present outlook, Willy Woo explained that recent developments surrounding BitMEX could actually prove to be bullish for the market in the long run.
“Fundamentally the market is scared for all the wrong reasons. MEX did NOT get hacked. No traders will lose coins. Futures exchanges will clean up their practices. We’ll see less volatility, less scam-wicking, more spot volumes, more organic moves, more institutional money.”
He further added that “more new investors are coming in than the mania phase of the last cycle (Dec 2017),” which is an incredibly positive sign that points to a maturing underlying market.
“Meanwhile the on-chain fundamentals are showing more new investors are coming in than the mania phase of the last cycle (Dec 2017), without it reflected in price.”
This could be one of the main reasons why Bitcoin has been so strong in the face of the recent news.
Featured image from Unsplash. Pricing data from TradingView.