This week is the last of the year. As we warned, the market players began to take profits, and the Bitcoin price dropped rapidly to $408. However, we then saw a rebound to $426 and this means that investors do believe in the future of Bitcoin, but prefer to close the year having more US Dollars in their hands, which is considered to be safer.
However, the Dollar is weakening on the foreign exchange market. Now investors expect the continuation of the decline of the Dollar against other currencies. Though, no important news from the US or Europe is expected until the beginning of the New Year.
Today, we expect Bitcoin price movement in the corridor of $420 - $440. We do not rule out the scenario of the price returning to $450. The support level is $400 and the resistance level is $440.
The question, what economic factors drive the price of Bitcoin, remains one of the most important. The number of transactions is a significant factor, but not decisive, since a certain number of transfers are carried out by the same owners from one wallet to another. Due to the high volatility of Bitcoin, it is difficult to call it a reliable store of value. News related to Bitcoin does not come every day. Therefore, we believe that the main factor affecting the price growth is the faith of investors in Bitcoin’s future. What do you think?
This analysis and forecast are the personal opinions of the author and are not a recommendation to buy or sell Bitcoins.