Bitcoin (CRYPTO: BTC) has broken out of a symmetrical triangle pattern to the upside, after a rally on Sunday evening. It is best to proceed with caution after the rally on Sunday, particularly on low volume, as they typically reverse.
However, I think relief across global markets and crypto is due in the short term. This is partly because China have decided to cut rates. In a monthly fixing, China have lowered the five-year loan prime rate (LPR) by 15 basis points to 4.45%. This is the biggest reduction since China revamped the mechanism in 2019 and means that China is stimulating its economy in attempt to propel growth. Even though the reason for cutting rates is due to Chinese consumers being very weak at the moment and lockdowns persisting, markets are forward looking, so if the government is stimulating for future growth, it is usually bullish for risk-on assets.
In addition, we are currently in oversold conditions, as Bitcoin has not seen significant relief since the 38% drop from $40,000 to $25,500 approximately. Lastly, Bitcoin has printed a higher high and higher low on the 4-hour time frame, which is a bullish indicator for continuation to the upside.
More companies are entering the metaverse as global electronics giant Sony (NYSE: SONY) have announced their own metaverse push in their latest annual corporate strategy meeting. Sony said this will be a more focused approach, as they aim to use metaverse-inspired experiences to engage users. With Sony owning the PlayStation brand, one of the biggest install userbases in the world, they are in an amazing position to make an impact. They have also revealed that prior investments in Epic, makers of the Fortnite game, and Bungie, another gaming studio, are part of this push. In my opinion, this is very bullish for Theta (CRYPTO:TETHA) Network, a blockchain project that provides infrastructure for video streaming. Sony are partnered with Theta, who can provide streaming for the metaverse by making use of unused bandwidth. I think Theta’s technology is vital to reduce latency and lag, and hence for Sony’s metaverse ambitions to succeed.
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