After several unsuccessful weeks for the entire sector, cryptocurrencies and Bitcoin need very little to regain enthusiasm. The weekend was quite interesting and on Sunday, the classic bearish trend appeared. Then the opening of the Asian session helped the markets continue to grow, and at the time of writing, prices seem to have stabilized.
However, the situation remains very complicated, and it will be necessary to rely on various initial data to understand what is happening and at what stage of the market we are at, which will eliminate the risk of entering at the wrong time.
Chinese maneuvers have made markets “frothy”
Expansionist maneuvers, which cost about a third of Beijing’s GDP and have obviously stirred up the markets. Something opposite to the need for closure that was overbearing in Washington and Frankfurt. This is a lot of money printed from scratch, which will support the rally in the market for some time. While it is true that this is good news in terms of recovery, it is also true that if it does not “tickle” the real economy, then this rally may turn out to be quite insignificant.
The session in the USA will still be the main one. It will open in the afternoon and which can give a much clearer signal about which direction the market is ready to take, if any. However, the situation, at least in the US, seems to be radically different from the situation in China: several problems in the economy are still ahead.
There is more and more insistent talk about a recession and the inability of the system, including thanks to the Fed’s compression maneuvers, to reverse the trend that has been dragging on for several weeks. All this was crowned with the usual bounces, recoveries and what should already be more than deserved, given that the cryptocurrency market, as well as the stock market, paid a very high price, perhaps unjustified even for typically risky assets such as cryptocurrencies.
Is June a turning month?
An old proverb said: sell in May and leave. However, this year this claim can be refuted, partly due to the many lucrative offers that appear on the market.
Many of the most popular cryptocurrencies are actually trading with a strong decline. And although some of them will not be able to rise again and return to previous price levels, there are many who use this type of transactions in the long term.
There are many delicious options, and the mini-recovery caused by Asian exchanges will prompt many of them to reconsider a possible break in work.
Have the markets finally discounted everything?
It depends on the person’s point of view. There are several analysts who believe that by now the markets have discounted everything — from the military rhetoric in Europe, to the energy shock and even the expected rate hike by the Fed and then the ECB.
Will it happen? If so, then we will be looking at the bottom for both the cryptocurrency world and probably the stock world. That is, provided that a long-term recession does not arise from this particular situation. We will continue to monitor, analyze and comment on the still undecided, but potentially bullish economic situation.
