Bitcoin's Price Could Rise If Facebook's Crypto Survives Congress Hearings

Bitcoin has come under pressure ahead of the U.S. governmental hearings on Facebook's Libra cryptocurrency on July 16 and 17.

Past data shows BTC tends to drop ahead of congressional hearings related to cryptocurrencies and rise on favorable outcomes.

Last year BTC fell from $6,820 to $6,070 in five days to July 12, before rallying to $7,400 on July 18 when the House Committee on Financial Services gathered for a hearing on "Crypto as a new form of money".

The cryptocurrency remained bid in the following days and rose to a high of $8,500 on July 24 because the hearing didn't take an overly negative tone.

On similar lines, BTC dropped from $12,000 to $6,000 in the 10 days leading up to a congressional hearing on Feb. 6, 2018, where the Securities Exchange Commission chairman and the head of the Commodity Futures Trading Commission testified before the Senate Banking Committee.

Going further back, the price action seen ahead of bitcoin's first congressional hearing on Nov. 18, 2013, was slightly different in the sense that the cryptocurrency was solidly bid, rising from $85 to $650 in six weeks leading up to the event.

Again the hearing on the growing popularity of virtual currencies wasn't anti-crypto, allowing BTC to extend the rally to highs above $1,150 on Nov. 30.

It is hardly surprising that the leading cryptocurrency is feeling the pull of gravity ahead of the congressional hearings on Libra and will likely take a hit if the U.S. lawmakers throw a spanner in the works for Facebook.

BTC may rise well past $13,800 and possibly hit record highs before the end of the third quarter if the hearings are more optimistic.

The long upper wicks attached to two out of the last three candles indicates bullish exhaustion and so does the bearish divergence of the RSI. All-in-all, the charts are biased for a drop to $9,097, unless the congressional hearings are more positive than expected.