Bitcoin (BTC) is currently trading at around $7,315 following a steep decline in price since Monday.
Over the past 24 hours, though, BTC increased by a whopping 6%.
Will Bitcoin maintain its positive price action and start its recovery towards $10,000 soon?
Since the massive bull market that took Bitcoin close to $14,000 earlier last year, BTC has been dropping in value following a downtrend that was only broken in late October 2019, when BTC surprisingly broke through a number of key resistance levels (around the 200-day, 50-day, and 20-day EMAs).
Bitcoin is still around 40% down from October’s high of $10,350.
If the $6,700 level was to be broken, the next stop for BTC, if the volume profile is to be believed, is just above $5,000.
Over the last quarter of the year, volume was also showing signs of weakness. During most of the period, volume stayed below $20 billion.
Until we see a clear reversal of key signals such as volume and volatility, I’m not expecting massive changes to BTC price-action.
If you’re looking to accumulate, this seems to be an amazing opportunity.
The current Bitcoin trend
Earlier this 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’. I’m personally expecting a big move either up or down soon.
Volume has remained similar to last week’s and 30% above last month’s. This means we could be starting to enter the end of the short-term accumulation cycle and price action could either pump or dump.
For the time being, as mentioned above, there’s a chance it can go either way. As long as the price continues to record lower lows, that’s a bearish sign. I’m patiently waiting for a reversal signal.
Hence the upwards movement today could mean a shift in sentiment – even though it is too early to tell.
For the time being, it seems we already found the bottom during 2019 and could be making way for a mid-term move to the upside.
Will the trend reverse soon?
As veteran traders and investors usually say, smart money “buys when there’s blood on the streets”. I’ve been saying for the past month that I’m waiting for major drops to make new entries. Moments like these are highly welcomed and appreciated.
I strongly believe Bitcoin to be a long-term store of value, especially as traditional markets continue to show weaknesses.
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 for the general economy.
The key aspect of the halving event is to understand if it is already priced-in by miners. I personally doubt it, since most people (and businesses) have a short-term mindset. In addition, miners’ behaviour shows there’s additional specialisation with better hardware being developed and released. Not only would that make the hash rate go up, it would also diminish profitability for the entire mining space. Hence, I see miners pushing for lower prices until the halving takes place. The harder it is to mine until the halving, the more miners will drop leaving more room for profits for the players who stay.
In conclusion, investors and traders should pay attention to the overall economic panorama, as it will most likely be a major catalyst for worldwide BTC adoption.
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:
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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.
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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.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.