Bitcoin is finished? Think again

Bitcoin is perceived as a risk asset, and therefore with nations on the brink of war, a sell-off of bitcoin could be set to continue. That said, there is nothing like bitcoin which is outside of the monetary system and unable to be controlled by governments. Bitcoin is the freedom asset.

War and finance

War is rearing its ugly head. The Middle Eastern conflict has even taken the focus off of the Russia/Ukraine war. Major States around the world are posturing and promising that if you do this, I’ll do that. Warnings and threats abound. The human race is living up to expectations.

For those looking to protect their finances, there doesn’t seem to be a lot that can be achieved by staying in their respective fiat currencies. Governments are either printing currency to pay for wars or they are printing currency to manage their debts. As more currency is printed, the debasement of the currency worsens. Those with assets see them rise, while the poor and middle classes, who don’t have assets, suffer increasingly from the resulting diminishing purchasing power of their currencies.

Bitcoin is outside of the system

The one asset that is outside of the traditional fiat currency-based monetary system is bitcoin. Instead of being able to be printed by corrupt governments, bitcoin is issued by code. The most scarce monetary/property asset on the planet, bitcoin blocks are produced by the miners with perfect regularity, and everyone can know the issuance - no surprises, and all set as though in stone.

Bull market means price generally goes up

Nevertheless, even bitcoin is subject to the ebb and flow of the market. When huge events such as war and failing economies are occurring, bitcoin is not impervious. It is bound to go through rocky periods just like any other asset.

However, that said, when bitcoin is in its bull market, which is currently the case, the price goes up. Of course, there are corrections as too many traders take on too much leverage and the market becomes extremely frothy. At times like this, whatever kind of correction is needed to reset the market, will generally take place.

Bitcoin has good support from previous bull market

Source: Coingecko/Trading View

For those worried about the bitcoin price, it is always best to zoom right out in order to get a really clear bird’s eye view. It should be noted that there is good support from the previous bull market under the price at $63,000 and $60,000. If the price were to break below these supports, the next big support is at $51,000.

Potential bullish pattern forming

Source: Coingecko/Trading View

Zooming in on the price action of the last few weeks, it can be observed that, unless there is a break of the $60,000 support, a chart pattern is starting to take shape. Now whether this will become a bull pennant, as signified above, or possibly a bull flag, it is still not known. But suffice to say, if the price does traverse sideways a while longer, a very bullish chart pattern could become the springboard for the next leg up of the bull market.

Is there a chance that the pattern could break to the downside? Yes, of course. Anything can happen in markets. That said, this is bitcoin, and you have to ask yourself what competition does it have within traditional markets? If your answer is practically none, then continuing to hold this asset is possibly the best move.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.