- Global tensions lead to a flight to safety.
- Bitcoin may benefit from the growth of uncertainty.
The world woke up on Monday to another portion of bad news. Iran announced the decision to exit the nuclear deal of 2015, while the president of the USA came up with new threats. Oil analysts are discussing if Iran would block the Strait of Hormuz, while traders ditch stocks and buy gold just in sake.
Bitcoin to capitalize?
Mike Novogratz expects that Middle East tensions will translate into Bitcoin growth. The head of digital assets merchant bank, Galaxy Digital, explained that the increased volatility would be supportive for Gold and Bitcoin (which is often referred to as digital gold). He wrote on Twitter:
Iraq will be expelling US troops. Iran will have more pull in Iraq which is what they always wanted. Saudi isn’t in a position to want a conflict. Mideast less stable. Equals more volatility.
In the long run, Iranian conflict may increase a global push for the de-dollarization narrative. As the theory goes, this will bring BTC in the limelight as an alternative global currency, that cannot be used by any country as a political lever.
Notably, at the end of 2019, Novogratz forecasted that Bitcoin would increase by 60% and hit $12,000 by the end of 2020. He came up with the most conservative forecast so far. While bullish about Bitcoin due to the US-Iran conflict, he has not updated his price forecast yet.
Not everyone agrees
However, some experts believe that the situation in Iran cannot be regarded as a bullish catalyst for Bitcoin. Earlier we reported that Alex Kruger supports this point of view.
Another cryptocurrency analyst and trader Alex (@_TradeWolf) commented on Twitter:
Just another Bulltrap accumulation for the next dump lower unfortunately. The Iran situation wont change anything. Bitcoin needs a true sustainable and organic catalyst and Iran is not going to be that catalyst. All world currencies would have to fail.
BTC/USD: technical picture
From the longer-term point of view, BTC/USD moved above SMA50 (Simple Moving Average) daily at $7,300 and managed to settle above this critical area. The coin touched the intraday low at $7,578 and retreated t0 $7,500 by the time of writing. A sustainable move above SMA50 daily bodes well for Bitcoin bulls as it implies that the upside momentum is gaining traction. The next barrier is located on approach to $7,700 (with December high at $7,689). Once it is out of the way, the upside is likely to gain traction with the next focus on psychological $8,000 reinforced by SMA100 daily.
On the downside, a sustainable move below $7,300 will negate the immediate bullish scenario and push BTC/USD back into consolidation mode with the lower boundary at $7,000. Reinforced by the lower line of the daily Bollinger Band, this area should slow down the bears and trigger another upside wave. If it is brokem the sell-off will continue with the next target at $6,800.
BTC/USD, daily picture
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