FX.co ★ Kevin O'Leary: Bitcoin is fueled by positive news

On the 4-hour TF, bitcoin continues to move inside the side channel of $18,500-$24,350, which no longer surprises anyone. In the near future, the price may encounter the upper limit of the descending channel, after which either a rebound from it should follow with the long-awaited continuation of the downward movement or an overcoming with an increase in the area of the level of $24,350. However, it seems that everything will go according to the scenario of a 24-hour TF, in which the price "did not notice" the trend line. Thus, the same thing can happen on the 4-hour TF, and we remind you that such a signal will not be considered a signal to buy or to grow. Overcoming a particular trend line or channel boundary should be clear, sharp, and unambiguous. If the pair has been in a side channel for almost 4 months and in a total flat for almost a month, then any overcoming cannot be considered a signal.

Although many economic experts continue to talk about the Fed's tight monetary policy as the reason for the further decline of bitcoin, some see a positive future for the cryptocurrency market. American billionaire Kevin O'Leary believes that as early as November, the US government may introduce new legislation to regulate cryptocurrencies and stablecoins, which will give investors optimism. The so-called "stablecoin transparency law" has already been submitted to the Senate for consideration. It clearly defines "stablecoin" and obliges all issuers to form reserves to secure their coins. These reserves can be government bonds or any currency. Issuers will have to provide information about their reserves, and only those companies that will be audited every 30 days will be able to obtain a license.

O'Leary also believes that this law does not directly apply to bitcoin, but it gives rise to a sharp increase in optimism about the main cryptocurrency. The billionaire believes that transparent and clear legislation can attract institutional investors. The businessman also believes that sooner or later, the whole world will accept bitcoin as its technology greatly facilitates transnational transfers and makes them very cheap. In general, we agree with O'Leary, but we believe that the "bearish" trend in bitcoin has not yet been completed. The cryptocurrency may grow significantly over the next 5–10 years, but it is unlikely to start doing so in the near future.

In the 4-hour timeframe, the quotes for "bitcoin" continue to move sideways. We believe the decline will continue in the medium term, but we need to wait for the price to consolidate below the area of $17,582-$18,500. If this happens, the first target for the fall will be a level of $12,426. The rebound from the level of $18,500 (or $17,582) can be used for small purchases, but be careful – we still have a downward trend.