Bitcoin (BTC) is currently trading at just above $8,440 following a 3% drop in price since last Monday.
Additionally, BTC has also managed to drop below its 200-day EMA – not a great sign for the bulls.
Bitcoin has been consolidating since last month after price spiked from $7,500 to over $10,000, before retracing to the $9,000 range.
Will BTC recover back to $10,000 and above soon?
Let’s take a look at Bitcoin’s chart.
At the time of writing, Bitcoin has been making a number of lower highs.
Since the massive bull market that took Bitcoin close to $14,000 earlier in the year, the coin has been dropping in value following a downtrend that was only broken in late October when price broke through a number of key resistance levels (around the 200-day, 50-day, and 20-day EMAs).
Following the late-October pump, where the price of BTC rose over 40% in the space of 24 hours, it seems the market has now stabilised.
Last week, I said I expected BTC to find a bottom near its 200-day EMA and that Bitcoin would bounce to around $10,000 soon. It has instead broken below its 200-day EMA, but crucially BTC has managed to stabilise since then and minimise any losses.
History shows us that BTC is prone to huge drops between 30% and 40% during bull seasons. Therefore, I don’t advise that you fight the trend, but surf it for as long as possible.
Last week, I underlined that within the next three to five weeks, we could see a major reversal after a period of serious accumulation by ‘hodlers’.
However, for the time being, not only has Bitcoin reversed its downwards trend, I argue BTC will reach $12,000 by the end of 2019 if we continue to see strong gains.
Volume, which had dropped from a peak of $27 billion earlier in the year to just over $15 billion last month, is now back to the $20 billion range. At the time of writing, it is about $21 billion. The volume profile also shows that BTC is near a key support level close to $8,100.
Bitcoin’s market dominance has also slightly increased about 1% since early November, from 65% to 66%.
As veteran traders and investors usually say, smart money “buys when there’s blood on the streets”. Currently, I’m waiting for another minor drop in price to make new entries. These drops won’t last forever, and if you think traditional markets are currently on a massive bull run, I wouldn’t be so sure the trend won’t reverse.
How can the markets continue to push higher throughout the year after the ECB’s recent rate cuts, the continuous share buybacks from huge corporations, or the inverted bond yield shoving investors away towards riskier assets?
In addition, repo market activity – as in loans from central banks to commercial and investment banks – has spiked to new monthly records. That adds up to another signal of weakness among most banks.
Safe trades!
Current live Bitcoin pricing information and interactive charts are available on our site 24 hours a day. The ticker bar at the bottom of every page on our site has the latest Bitcoin price. Pricing is also available in a range of different currency equivalents:
US Dollar – BTCtoUSD
British Pound Sterling – BTCtoGBP
Japanese Yen – BTCtoJPY
Euro – BTCtoEUR
Australian Dollar – BTCtoAUD
Russian Rouble – BTCtoRUB
In August 2008, the domain name bitcoin.org was registered. On 31st October 2008, a paper was published called “Bitcoin: A Peer-to-Peer Electronic Cash System”. This was authored by Satoshi Nakamoto, the inventor of Bitcoin. To date, no one knows who this person, or people, are.
The paper outlined a method of using a P2P network for electronic transactions without “relying on trust”. On 3rd January 2009, the Bitcoin network came into existence. Nakamoto mined block number “0” (or the “genesis block”), which had a reward of 50 Bitcoins.
If you want to find out more information about Bitcoin or cryptocurrencies in general, then use the search box at the top of this page. Here’s an article to get you started.
As with any investment, it pays to do some homework before you part with your money. The prices of cryptocurrencies are volatile and go up and down quickly. This page is not recommending a particular currency or whether you should invest or not.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice.
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