Bitcoin analysis for 06/02/2018

The British credit card issuers are afraid that people will get into debt if they buy cryptocurrencies and the prices will continue to fall. The Lloyds Banking Group will issue a statement to its nine million credit card users today. According to reports, the bank will block all attempts to buy cryptocurrencies using credit cards. However, debit cards are still accepted. In an email, a company spokesperson said: "We do not accept purchases of cryptocurrencies made with credit cards at Lloyds Bank, Bank of Scotland, Halifax and MBNA".

The banking giant is the first in the UK that limits its credit cards and the purchasing power of its customers. It could additionally exacerbate the drop in prices because it became a bit more difficult to buy cryptocurrencies. Some banks are already anti-crypto because decentralized money is against their business model. This movement follows a wave of government regulations around the world which want to prevent the use of digital currencies for criminal activity. In contrast to many misleading reports in the mainstream media, there was no ban on trade or trading in India or South Korea. Three large US banks take a similar stance on the last week's announcements. JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc. stated that they would no longer allow the purchase of a crypt by means of a credit card. Using a credit card is riskier, and the banks try to mitigate it by forcing their clients to use their own money to buy virtual currencies. They are also concerned that customers will spend more than they can afford - which is much easier when they are not their money.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. The overall rally to the level of $19,550 might be considered completed, and the correction to the downside is the part of another, bigger cycle. Currently, the price has reached the territory of the previous wave (4) of the lower cycle, and the low of this wave is at the level of $5,520. This might be the level for a bounce higher.

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