Bitcoin analysis for 06/03/2018

In his speech at the inaugural Scottish Economic Conference in Edinburgh, Bank of England Governor Mark Carney called on the authorities to regulate the cryptocurrency market, instead of banning them directly. According to Carney, cryptocurrencies do not currently threaten financial stability, but they can, after the involvement of more consumers. Carney believes that the time has come to integrate the cryptocurrency ecosystem with the rest of the financial system, applying the same regulatory approach and the same stringent standards. Carney believes that this would not only minimize the risk of money laundering but also helped to adapt the technology to wider public use. After a recent speech at London's Regent's University, where Carney argued that Bitcoin had failed as a currency, the CEO of the Central Bank reiterated his opinion that digital currencies such as Bitcoin should actually be considered assets. He also noted the tremendous volatility of these assets, stressing that cryptocurrencies show the classic characteristics of bubbles because their prices are based on beliefs regarding their future supply and demand and have no internal value or external support.

The British electoral commission announced that it would initiate an investigation into the cryptocurrencies and their effects on British investors and enterprises. The purpose of this study is to examine the risks and benefits of digital currencies and Blockchain technologies.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. The market is very close to testing the recent local swing high at the level of $11,714 and the price behavior at this level will be crucial to establishing the future market behavior. In a case of an impulsive breakout, there is a high possibility of wave 3 development. On the other hand, in a case of a sudden price reversal, there is a high possibility of a corrective wave 2 development to the downside. It is worth to keep an eye on the market behavior at the mentioned levels.

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