Tesla Q2 earnings will have an impact on Bitcoin’s price action. The tight range seen in the last two months and the bearish price action led to decreased volatility in the crypto market.
Most FX brokers offer access to other financial markets besides the classic exchange rates. As such, from the same trading account, one can speculate or invest in commodities, stock market indices or digital assets, such as Bitcoin.
Bitcoin is the main cryptocurrency in the digital space, and its volatility and direction impact all other cryptocurrencies. It has fallen back to its start-of-the-year levels and found support at $30,000 after trading as high as $64,000.
The recent consolidation looks bearish from a technical perspective, as traders await Tesla Q2 earnings for future direction. On any clue that Tesla sold some or all of its Bitcoin holding in the second quarter, Bitcoin’s support is poised to break.
Did Tesla Hold On To Its Bitcoins?
One of the reasons, and perhaps the most important one, why Bitcoin outperformed in the first months of the year was Tesla’s announcement of a $1.5 billion investment. It looked like the crypto adoption increased significantly after the company announced that it would accept Bitcoin as payment for its cars. But the rally faded after it then reversed its decision on concerns over the impact crypto mining has on climate change.
Tesla posted a profit in the first quarter of the year mostly because of selling carbon credits and some of its Bitcoins. It would have posted a loss based solely on car sales.
The 50% decline in Bitcoin in the second quarter is surprising because of other public investments announced in the meantime. For example, MicroStrategy invested over $1 billion in Bitcoin during the quarter, and yet the price declined.
For every buyer there must be a seller, and rumours in the market have it that Tesla might have sold some, if not all, of its Bitcoins. The Q2 earnings will shed some light and will likely be the catalyst for the next major movement in the price of Bitcoin.