On Friday, Venezuelan President Nicolas Maduro announced a new unified exchange rate for Bolivar, which is linked to the virtual Petro currency. According to the new guidelines, one Petro would have the equivalent of $ 60, which means that the country's currency is substantially devalued by 96%.
In the face of enormous political and economic turmoil in the South American country, Maduro has recently announced various economic changes during broadcasting on public television. The socialist leader said he would raise the minimum wage by more than 3,000%, increase the corporate tax rate and raise gas prices in the next few weeks.
Maduro also provided another news related to Petro's national virtual currency. He said that one Petro would be worth $ 60 and would correspond to 360 million Venezuelan bolivars. The new rate means that one dollar will amount to 6 million bolivars, which is a rate close to what can be seen on the black market. However, at the time the decree was in force, the domestic exchange rate of the Central Bank was 248,832 dollars per dollar, which means that the new figure is roughly 96% devaluation.
While Maduro said that the new economic initiatives are part of his "formula" to help "recover the country," many economists believe that the plans will lead to a greater disaster for the country's population. Experts say that these initiatives will only reduce the already small salaries that many citizens have and indicate that tax increases and minimum wages will make many companies and businesses have to fight even more.
Increasing inflation rates have been seen in the country for some time, but in recent days they have become more and more severe. The International Monetary Fund now believes that inflation in Venezuela will reach one million percent in 2018.
Increasing economic conditions have prompted many citizens to emigrate to other nations in South America, which has caused one of the worst migration crises in recent years. After the statement by Maduro, opposition leader Henrique Capriles wrote on Twitter: "No Venezuelan deserves this tragedy or that those incapacitated people will destroy our nation".
Let's now take a look at the Bitcoin technical picture at the H4 time frame. The market remains inside of the horizontal consolidation between the levels of $5,846 - $6,597. Currently, the price is just above the weekly pivot at the level of $6,359 and just above the internal trend line support marked in blue. The key level to the upside is seen at $6,597 and in a case of a breakout higher, the next target for bulls is seen at $6,752. On the other hand, the intraday supports are seen at the levels of $6,179, $6,134, $6,083 and $6,034.
