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Since Bitcoin (BTC) tapped $6,500 in late-November, analysts have been wondering if the bottom is really in. You see, the leading cryptocurrency bounced by 20% from $6,500, hitting $7,850 just a week back.

Related Reading: Eat My Shorts: Everything You Need To Know About The Bitcoin Bart Pattern

While some say that the fact that Bitcoin failed to crack the key resistance near $8,000 is decisively bearish, analytics companies in the industry are starting to believe that a bottom is forming.

Bitcoin May Soon Bounce

On-chain market intelligence firm Glassnode recently observed that there is a confluence of factors suggesting that the Bitcoin bottom is forming, if not here already.

They first noted that the Market Value to Realized Value (MVRV), the ratio between market cap and realized cap, is “consolidating towards one,” which implies that gains are being realized by Bitcoin investors. A one reading of the ratio often marks a bottom for the cryptocurrency market.

There’s also Unrealized Profit, which “paints a very similar picture.” “As investors have less profit to realize, sell pressure starts to diminish allowing for upwards momentum to build,” the firm wrote noting the importance of the metrics.

It isn’t clear if Glassnode’s analytics implies that Bitcoin will range in the low-$7,000s for a while, or if the cryptocurrency will see one flash move lower. Though, whatever the case, the “bottom is close—and once it happens, the reversal will be strong.”

The “strong reversal” narrative being pushed by the analytics startup is consistent with other analyses.

As reported by NewsBTC just days ago, the opening month was harrowing for Bitcoin (BTC) for one reason: the open of the December candle for the cryptocurrency’s price triggered a “sell” signal on the Market God v7 indicator.

Related Reading: Bitcoin CME Futures Gaps Are Filled With 95% Certainty, But Trading Them Is Risky

This was seen as bearish, as the last time the indicator gave the signal was in April, which was prior to the move that took the price of Bitcoin from five digits to $3,150, before printing a buy signal near the bottom.

Though, according to Thies’ latest check of the indicator, the “sell” signal has dissipated as bears have failed to continue to push lower the price of Bitcoin.

Bottom Pattern Forms

That’s not to mention that a bottoming pattern is forming on Bitcoin’s chart. Popular cryptocurrency analyst Jonny Moe noted that BTC’s chart is currently building a bottoming pattern, which could show that its downtrend formed after the pump to $10,500 is over:

“The BTC inverse head & shoulders we saw last week has turned into an Adam on a potential Adam & Eve bottom. You could interpret the Eve as the beginning of a cup & handle continuation as well. Both of these are still just potential, but certainly there.”

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Nick Chong , 2019-12-07 22:30:45

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NewsBlock © 2019 - 2020 All rights reserved.

NewsBlock © 2019 - 2020. All rights reserved.


While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

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Nick Chong , 2019-11-10 12:00:38

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