Bitcoin is trying to stage a recovery early this week, but struggles to gain momentum as bears are still in control of the virtual currency. Today’s gains are so far capped by the $13,770 mark. The cryptocurrency is up 2.2% on the day.
Despite the downside pressure has marginally eased lately, and the price doesn’t leave attempts to regain the local resistance in the $15,000 area, the bearish risks still persist on the back of government crackdown around the world.
It looks like the Chinese authorities are set for escalating the crackdown on cryptocurrency trading, targeting online platforms and mobile apps that offer exchange-like services. Moreover, the government is said to also target individuals and companies providing settlement, clearing as well as market-making services for centralized trading.
Meanwhile, the South Korean authorities have somehow allayed market concerns after emphasizing that the plan to ban cryptocurrency exchanges is just under discussion, and the final decision is yet to be taken.
The overall background in the industry stays gloomy on the back of regulator’s signals around the world that continue to scrutinize digital currencies. In such circumstances, the bullish potential is still limited, and further attempts to overcome the $15,000 mark will likely continue to attract sellers. In the short-term, bitcoin needs to regain the $14,000 level.
By Helen Rush
Senior Analyst at Capital Markets