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At the time of writing, Bitcoin was trading at $38,284 with 0.7% profit in the past 24-hours. However, it quickly managed to get above previous resistance and trades at $40,561 with a 7.66% profit on the daily chart.Historically, war-related sell-offs have been great buying opportunities, particularly large-scale war involving superpower. In the Vietnam war (1964) Gulf War (1991), Afghan War (2001), Iraq War (2003) and Crimean Crisis (2014), markets saw positive returns for 3-6 months after the invasion.
The firm believes the current situation has been following the pattern as Bitcoin and other assets seem to be bouncing back. This situation could sustain itself, at least for the short term, but QCP Capital recommends cautions as there are many potential global headwinds.
Daniele Casamassima, CEO at Pure Fintech told NewsBTC the following on the current situation:This uncertainty in the crypto market is further hindered by the fact that there is now a close correlation between financial markets and global crypto markets.
Break Or Bounce, Why Bitcoin Could Follow Old War Patterns
A similar situation occurred in 2001 with the U.S. invasion of Afghanistan, the report said. At that time, the market bounce back for 3 months, and then returned to a downtrend that broke previous lows.Related Reading | TA: Why Bitcoin Must Close Above $40K For Trend Reversal
Casamassima added the following on a potential bullish thesis for Bitcoin:The digital currencies, although badly affected at the moment, in the long run could become the only feasible option for those people that are the most affected by new economic sanctions. Therefore the bear market could turn into a bull market.