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Bitcoin price changes after paypal announcement

Bitcoin, News

I am observing the price of Bitcoin for the last year and it was sudden for me to experience such a sharp uplift from $370 to $450 just in few hours, yesterday. The only reason behind such a sharp movement of Bitcoin price was Paypal’s announcement regarding digital currency integration with its merchant services. But still, if you compare the current price with the one in the beginning of the year then it is approximately 50% down.

Everyone related to Bitcoin industry is trying to search for reasons of decrease of the price from its pick of $1100 during December 2013 to its current price that ranges from $370 to $450. While observing every happening and measuring significance of all possible affecting events; I am unable to find any specific reason other than asset allocation.

You can understand it better when you realize that investors seek to put their money in better opportunities where they expect relative high return. However, Bitcoin price was shaky during that last year. Therefore, investors shifted their focus.

Bitcoin losing focus
Bitcoin losing focus

Bitcoin losing focus

Understanding the concept is easier when we realize that money shifts are focused on the pool where it can multiply. Selling brings more pressure on a typical pessimistic loop response. Seeing that Bitcoin continues to lose its worth, further selling will happen, particularly between miners and retailers.

Some people claim that everyone is concerned and anxious to keep Bitcoin. They are not ready to hold Bitcoin as they expect bigger devaluation. According to my analysis; it won’t stop until adoption and implementation of appropriate hedging. Bitcoin needs support from different derivative products to maintain its position.

 

Bitcoin Future Outlook

In case of a stock market correction, the funds will flow from the stock market to other asset classes. So, there are chances and expectations that cash will flow in the direction of under-performing asset classes including bitcoins, hard and soft commodities and other emerging markets.

A few members in the Bitcoin industry have contemplated that the Alibaba IPO has affected bitcoin price negatively. However, I believe and perceivet as a positive sign because all those who have acquired shares at $68 each will approximately earn thirty two percent profits on each share in only a few days. However, if we analyze and conclude bitcoin’s price pattern then we can state that bitcoin price started mounting in last October and it may follow the same pattern this year.

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