Bitcoin and the flight from cash

Today Bitcoin futures once again found resistance at the level it had broken above on Monday of last week. This level is the 23% retracement from 2019’s highs and comes in at $11,900. Currently BTC futures are up fractionally on the day and pegged at $11,760.

It seems as though our assumption that Bitcoin would benefit from the current flight from cash just as gold and silver have done may indeed be correct. This was evident last week as BTC and gold moved in similar fashion. Gold is showing resistance at $2,000 a price point it had traded above recently. Just as BTC is experiencing resistance at $12,000 in the same way.

In fact, last week Gold futures and Bitcoin futures traded in the same direction every day except for one. Just as they had done the week prior. Expect this trend to continue as long as the precious metals markets are overcrowded. With much of the spill over caused by the flight from cash ending up in Bitcoin.

With the 2020 presidential election just a few months away the uncertainty that will come along with it will likely further the drop in the U.S. dollar unless a vaccine is released by that point. With that being highly unlikely we expect the rise is BTC futures to continue even though $12,000 is proving to be a strong area of resistance.