Crypto Industry News:
Cathie Wood, founder of asset management company ARK Invest, sees the possibility that central banks could start amassing bitcoin and other cryptocurrency assets. Wood found that when consumer demand shifts from commodities deflation, not inflation, will hit global markets.
"We believe deflation is much more likely. I know most people think this is crazy given what is happening, but we are already seeing a very significant drop in the prices of some commodities. We believe that what happened here is that consumers have spent the last year spending money on the only things they could do, which are commodities, durable goods, and non-durable goods.
Firms were behind the curve even before the coronavirus due to the inverted yield curve. They feared a recession ... So businesses were terrified and conservative. Consumers have started to buy goods, and now - being vaccinated - they intend to shift their market basket from goods to services ... So I think what will happen here is that businesses will now see a two-, three- or even fourfold increase in orders [ ...] When the market basket shifts towards services. I think commodity prices will drop significantly next year. "
As companies try to get rid of excess supply, commodity prices are falling. As such, Wood predicts emerging markets will be hit by a huge blow. He adds that the effects of deflation will cascade emerging market fiat currencies, forcing their central banks to take refuge in bitcoin and other cryptocurrencies.
Technical Market Outlook:
The BTC/USD pair volatility has decreased significantly, but the bulls are climbing higher step by step. The momentum is still hovering around the neutral level of 50, but is not dropping lower. The market still trades under the supply zone located between the levels of $43,1459 - $41,794, so bears are still in full control of the market and only a strong breakout above the level of $41,096 (38% Fibonacci retracement of the last wave down) would temporary change the outlook to bullish. The next target for bears is May 19th low seen at the level of $29,701.
Weekly Pivot Points:
WR3 - $58,682
WR2 - $52,643
WR1 - $41,961
Weekly Pivot - $35,513
WS1 - $25,163
WS2 - $18,359
WS3 - $7,655
Trading Recommendations:
Even despite the recent correction the bulls are still in control of the Bitcoin market, so the up trend continues and the next long term target for Bitcoin is seen at the level of $70,000. Any correction or local pull-back should be used to open the buy orders. This scenario is valid as long as the level of $30,000 is clearly broken on the daily time frame chart (daily candle close below $30k).