The exchange rates of Bitcoin vs. US. Dollar has been holding level between $440 - $460 a few days in a row. Positive macroeconomic indicators from the US and an increase in interest rates to 0.50% led to a strengthening of the Dollar. However, Bitcoin’s price was unharmed.
Today, the release of another piece of important economic data is also expected. The Dollar relative to other currencies will be further strengthened, while Bitcoin should continue its sideways trend to about $440 - $470 and begin to grow to the levels of $480 and $490.
We can see an increase in the yield differential of US government bonds on the world’s bond market, which affects the strengthening of the dollar. The recent decisions of both the Federal Reserve and the European Central Bank also stimulate investors to buy the US national currency. Moreover, bad expectations for the price of oil makes purchases of Dollar promising, thus, we see the strengthening of the USD against the decline of other currencies. But, as we have seen it has almost no effect on the Bitcoin macroeconomic outlook.
We asked cryptocurrency experts about possible Bitcoin price changes in the next 24-36 hours:
Vishal Gupta is the Founder of Bitcoin Alliance India, CEO at SearchTrade, and Director at Moving Trumpet, who focuses on investments in the consumer Internet, market places and business SaaS:
“Bulls in the market seem to be consistently testing if than can breach 470 lvls and bears seems to be keeping it in check. The trading range is between 450 and 460 since past few days. Breakout point on down side could be 440 and upside 470. If market crosses 470 it might rally to 500 and come back.”
Aurelien Menant, CEO at Bitcoin exchange Gatecoin and a founding member of the Bitcoin Association of Hong Kong:
“It seems that investors had already priced the long awaited interest rates raise, which explains why the bitcoin price did not move. It also appears that there is some resistance towards $ 460 so the price in the next few days will really depends on whether we can cross that threshold or not. In my opinion, price should be beyond 470 by Monday, with a possible temporary relative drop beyond there. On the mid term, I expect the price to cross the $ 500 barrier by year end, and keep on raising at least until Chinese New Year.”
Simon Dixon, CEO at BnkToTheFuture and Fund Manager at Bitcoin Capital, who also has written two books on the future of finances:
"With the fed making the decision to increase interest rates and central banks around the world adjusting their interest rates based on this decision, we can only expect market shocks throughout 2016. I believe that this was factored into the proceeding Bitcoin price increase as Bitcoin can act as a hedge against traditional financial market shocks. I would expect Bitcoin to remain flat over the next few days as new investors jump in after hearing about the price increase and profit takers sell coins to pay for their Christmas shopping in equilibrium. I believe we have seen most of the large swings for 2015 now, ready to continue the bull market in 2016 as markets react to the interest rate increases."
Mike Lorrey, co-inventor of cryptocurrencies Galactic and BitGold:
“My prediction for bitcoin is 455-460 within 36 hours. Its the start of an upward trend. There's a peak in 4-5 days, then a pullback, then sustained growth thereafter for 3-4 weeks.
This is assuming there are not any major events that could impact the price.
Predictions further out are less reliable than near term, but near term predictions are always subject to market volatility.”
To date, we expect Bitcoin to move in a sideways trend in the range of $440 - $470 and attempt to test tops of $480 and $490. Today, December 17, the resistance levels are $440 and $490. The support levels are $440 and $430.
However, there are still some question for discussion: Which factors besides the transaction volumes actually affect the Bitcoin price? And what could cause a sharp demand for Bitcoin from investors?
This analysis and forecast are the personal opinions of the author and are not a recommendation to buy or sell Bitcoin.
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