As the global financial crisis caused by the coronavirus pandemic seems to be getting worse, the cryptocurrency markets have managed to stay afloat, and this is largely related to the ongoing Bitcoin rally. After spending a few days dancing around the $10,000 price level in mid-February, Bitcoin took a deep plunge that lasted a few weeks; it was not until the middle of March that the carnage stopped when BTC/USD dipped below $5,000. From that point on, Bitcoin has been on a steady bullish rally that many market analysts believe could last through the month of May.
As residents in some parts of the United States prepared to celebrate Cinco de Mayo while observing social distancing measures, Bitcoin was not only approaching the $9,000 mark but also posting solid trading volumes, thus prompting some analysts to forecast a return to $10,000 within weeks. What this price movement shows is that BTC has matured to the point of resiliency, particularly when considering how much Wall Street has been struggling. Some market observers think that Bitcoin appears to finally be turning into a flight-to-safety investment commodity similar to gold, and this is being validated by the current rally, but it would not be prudent to forget about volatility.
Fluctuations in the Market
In the wake of Black Monday 2020, uncertainty on Wall Street spilled onto the commodities markets. Crude oil went into crisis mode even before the World Health Organization declared the COVID-19 pandemic. Gold prices plunged along with Bitcoin, and it seemed as if the United States Dollar was the only safe haven. Two weeks later, both Bitcoin and gold started to recover along with Wall Street, and this is a clear sign of resiliency. BTC tokens still have the power to pull the entire cryptocurrency market, which explains why various other digital currencies have also enjoyed renewed interest by investors.
With all the above in mind, it is not unreasonable to think of Bitcoin returning to $10,000 in May; however, investors should keep a close eye on the market because this is an investment commodity that continues to move at a volatile pace. A market pullback can always be expected once Bitcoin breaks through the psychological $10,000 price level. Technical charts tell us that this happens because active traders have historically sought to rake in profits at this point. There is a chance of BTC/USD attracting more investors at a time when fundamentals are looking bleak on Wall Street, but market volatility should always be kept in mind.