Bitcoin Faces Rejection At $7000 Even After the Federal Reserve Stimulus Package
Bitcoin and the overall cryptocurrency markets have been showing high volatility over the past two weeks. Earlier on Monday, March 23, Bitcoin was trading under $6000 levels as part of the market-wide correction.
However, soon as the Federal Reserve announced a stimulus package later in the day, Bitcoin and the overall crypto markets made an important spike. The BTC price surged above $6000 levels to its way forward.
In the last two days, Bitcoin has been trading around $6500 levels. However, on Wednesday. Bitcoin failed to cross above its major resistance of $7000. This shows that the effect of for the fiscal stimulus was short-lived.
At the time of writing this article, Bitcoin was trading at a price of $6653 with a market cap of $121 billion.
The Federal Reserve has announced a $2 trillion fiscal stimulus package besides additional measures like zero interest rate policy, an open-ended asset purchase program, and other quantitative easing measures.
With this, the total global stimulus has reached to $8 trillion which is around 9% of the global GDP. The New York Times report suggests that the latest stimulus plan will send direct payments and other benefits to individuals. Thus, they expect the cryptocurrency and Bitcoin bids to go higher as money comes in the hands of people.
Bitcoin had a good start to 2020 with its price surging to $10,000 levels by the mid of February. Thus, Bitcoin was trading at a 40% premium year-to-date in mid-February.
However, the BTC price along with the overall crypto markets started a sharp downward journey. Wiping out all its early gains, Bitcoin is now trading at negative year-to-date returns.