Bitcoin – Buoyed by oil and gas claim

Can it break resistance?

In the latest twist in the crypto space, Russian lawmaker Pavel Zavalny, claimed the country may consider accepting payment for oil and gas in bitcoin from friendly countries.

I mean, this should seriously be taken with a pinch of salt for a number of reasons. Not least Russia’s widely known opposition to cryptos. Add to that the fact that one major friendly export market is China, where bitcoin is banned.

I can’t help but think this is just a case of a lawmaker trying to appear calm about an extremely undesirable situation and play up the ease with which the sanctions can be circumvented.

In reality, this is basically a non-starter any time soon, if ever, and would bring considerable risks as a result of the volatility that comes with cryptos.

I’m not sure avoiding sanctions imposed as a result of a horrific invasion is what crypto purists had in mind but nonetheless, potential use cases are typically bullish for the price, as we saw in the last month following reports of oligarchs using it for similar purposes.

It’s an interesting story though and it’s seemingly given bitcoin a bump back towards $45,500 where it’s once again seeing resistance.

Once again, we’re seeing momentum indicators on the 4-hour chart not making any significant gains as price has risen and the fact that this is occurring around a previous resistance zone that coincides with the 200/233-day SMA band probably isn’t a coincidence.

If it can break above here though, it could propel bitcoin higher and the momentum indicators could confirm this. Until then, we may see further consolidation, as we’ve seen for many weeks now.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Craig Erlam

Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam