The price of Bitcoin (BTC) against the euro gains more than 200% in this year 2020. Can we still take the bandwagon while managing its trading risk?
Scholarship 2020, a crypto year
The stock market year is coming to an end and the time for the first assessment has come for the performance of financial assets. It is in particular an excellent year for two main sectors of activity, that of technology and that of health on the equity market. The technological stars, and not only those of the Nasdaq, as well as pharmaceutical and biotech stocks, have achieved a largely bullish year, barely slowed down by the rebound in cyclical stocks in November.
Without a doubt, this 2020 stock market year is therefore a technological year… a technological year certainly, and also a cryptographic year!
Cryptocurrencies come from blockchain technology, they are applications of it. But cryptoassets are not technological assets because they do not belong to the same asset class; Cryptocurrencies are indeed an asset class in their own right, belonging neither to Forex nor to commodities and can claim a defined place in the stock market hierarchy.
I invite you to watch my last video on this subject, it presents among other things an annual ranking of major cryptocurrencies:
Can we still take the Bitcoin (BTC) train running?
As the graph below shows, the price of Bitcoin (BTC) against the euro is gaining more than 200% this year . It is therefore legitimate to ask the question, especially if you have never bought one before.
On the stock market, you have to follow the trend, but you also have to manage your risk. Technical analysis reveals support levels for buying „well“ and currently, it is the old historical record which constitutes the first tangible support, ie € 16,500 , 15% below the current market level.
Under the prism of the medium / long term, there is no subject, the uptrend will develop further next year. The short-term framework is much more uncertain , equiprobable between returning to the old historic top, or continuing the increase towards € 21,600 . It is imperative that the short-term trader – that the day-trader – be aware of this very large gap in the major support for smart money.