After reaching $10k last week, Bitcoin is now trading below $8,700. Bitcoin 2020 halving is around 12 hours away but analysts warn that a second coronavirus wave could stop the Bitcoin rally after halving.
After closing last week on a high note, above $10K, Bitcoin price shed almost $1,500 over the weekend to trade below $9,000. With less than 12 hours to the 2020 BTC halving event, the selloff triggered a new wave of volatility that is expected to continue. The increased volatility is likely to push the asset trading lower, with fears of a new wave of coronavirus likely to erupt. Will coronavirus stop Bitcoin price rally?
The highly anticipated event is mixed with different expectations due to several underlying critical market fundamentals. The market fear, which is driving most investors crazy, is likely to cost 2020 halving negatively. Since the world is currently fighting an invincible enemy, Covid-19, and no one clearly knows when it will be over.
Using the BTC/USD derivative on the 1-hour timeframe, the asset is hanging on last week’s low at around $8,690. However, analyzing the 4-hour chart, the instrument has not yet broken the higher-highs and higher-lows. Further checking the weekly chart, the asset re-bounced on the upper boundary of a wedge formation, indicating a further drop may be on the card.
With 77 blocks remaining until the mining reward is halved, miners are rushing to accumulate more of the asset, while huge traders manipulate the market into their favor. The weekend selloff was quick profit-taking for those who bought the asset trading around $5k and at the same time worry for small retail traders who were anticipating a continuation of the rally.
Bitcoin Price Rally Endangered by a Possible Second Coronavirus Wave
Most countries around the world have stabilized the coronavirus outbreak, despite several not opening up for businesses as normal, as you mat read in our coronavirus updates section. The virus has turned out to be more deadly to people with pre-existing health conditions and the old aged in society. It has been studied from the developments since it was declared a world disaster and a possible vaccine like the Remdesivir and Favipiravir showing the potency of treating Covid-19 patients successfully.
At the time of reporting, the number of confirmed cases is over 4 million, with the U.S. taking around a quarter of it. With the vaccines months away from being released and approved, the second wave of coronavirus is likely to erupt.
If it happens, things are likely to turn chaotic for most stock markets with the cryptos not left behind. Mark Zandi from Moody Analytics said:
“If we get a second wave, I will be a depression. We may not shut down again, but certainly, it will scare people and spook people and weigh on the economy.”
On the positive side, it has been shown that for miners to remain in business after the halving, BTC price will have to be over $12K, hence giving holders hope of an imminent rally.
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