Bitcoin is currently testing a crucial level of resistance following a woeful month that saw it lose 16.19% of its value.
At the time of writing it was trading at $38,300 having momentarily lifted itself above $39,000 this morning.
Bitcoin bulls will be hoping for a clean break above the psychological level at $40,000, although it’s worth noting that short interest will be high as traders attempt to predict a gruelling lower high.
The world’s largest cryptocurrency remains in a downtrend on all time frames. However, a relief rally is expected this month as throughout Bitcoin’s history it has only painted four red monthly candles in a row on one occasion – during the 2018 bear market.
Since Bitcoin formed an all-time high of $69,000 in November, it has lost more than 44% of its value as the hype around the previous bull cycle rapidly erodes.
Google searches for “Bitcoin” are 50% lower than last May, indicating that retail participation in the market has dried up.
This is in a stark contrast to NFTs, which have surged by 400% since September as investors look for faster and more hype-fuelled gains instead of Bitcoin.
From a technical perspective, Bitcoin has an important area of support between $39,000 and $40,000. If this area gets taken out it should set itself up for a rally to at least $43,000.
However, if it fails to make ground at this level, it is expected to slump back into the previous range between $36,400 and $37,300.
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In August 2008, the domain name bitcoin.org was registered. On 31st October 2008, a paper was published called “Bitcoin: A Peer-to-Peer Electronic Cash System”. This was authored by Satoshi Nakamoto, the inventor of BTC. To date, no one knows who this person, or people, are.
The paper outlined a method of using a P2P network for electronic transactions without “relying on trust”. On January 3 2009, the BTC network came into existence. Nakamoto mined block number “0” (or the “genesis block”), which had a reward of 50 Bitcoins.
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