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  • Bearish sentiments linger over Bitcoin (BTC) months before halving.
  • A unique market for Bitcoin miners.
  • BTC/USD slips further below $8,100 USD as bears firmly in control.

Bitcoin’s price is currently on a free fall, clearing out most of the gains from President Xi’s embracing speech on blockchain, and latest developments shows the halving may not save it. Well, according to one indicator created by Willy Woo, partner at Adaptive Fund, the current sustained downtrend in BTC’s market is set to form a ‘unique’ setup leading to the halving in 2020.

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“Never entered a halving period BEARISH”

A look at the “Bitcoin Difficulty Ribbon”, an indicator that tracks the price in relation to the difficulty of the network, paints a really bearish picture on the future price of BTC following May 2020’s block reward halving. The possibility of a first bearish price run leading to the halving is on the cards, strengthened by the recent drop below support levels at $8,500, $8,200 and $8,100.

BTC difficulty ribbon

According to Woo, the current selloff originates from miners pressure to sell months to the halving which presents a unique feel to the halving of BTC in 2020.

“Historically we front run with a BULLISH setup, miner capitulating only after halvening when revenues are slashed.”

A unique market pattern

As the price of Bitcoin plummets, weaker miners are chucked out of the network due to unprofitable business. This leads them to dump their BTC on to the market creating a huge selling pressure as we saw in 2018 during the bear run from all-time high prices the preceding year.

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With the markets bullish 6 months prior to the halving in each of the last halving periods, November’s bearish momentum presents a unique setup for BTC leading up to the event.

While only two prior halvings have occurred in the past it would be a stretch to try to correctly predict the future trends of BTC’s price following the halving. Some analysts believe the halving has already been priced in which makes a case for the perma bulls.

However, according to a poll on Twitter by Jameson Loop, CTO at Casa HODL, with over 6000 votes were cast, 68% believe the having will cause yet another explosive spike in BTC’s price.

BTC/USD short term indicators signals bears firmly in control

Looking at the daily charts, BTC/USD is set to test support levels below $7500 in the coming days, as bears take firm control of the market. Since a death cross formation, the SMA 50 is widening from the SMA 200 signaling a possible drop towards resistance levels at $7,412 USD.

A close below the $7,800 support level will spell doom for the pioneer cryptocurrency signaling a continuation of the bear market since July. Could the miners selling pressure push the price towards the falling channel support?

Summary

This indicator Signals a ‘Unique Setup’ for Bitcoin Price Prior to 2020 Halving

Article Name

This indicator Signals a ‘Unique Setup’ for Bitcoin Price Prior to 2020 Halving

Description

Bearish sentiments linger over Bitcoin (BTC) months before halving.
A unique market for Bitcoin miners.
BTC/USD slips further below $8,100 USD as bears firmly in control.

Author

Lujan Odera

Publisher Name

CoinGape

Publisher Logo

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Coingape is committed to following the highest standards of journalism, and therefore, it abides by a strict editorial policy. While CoinGape takes all the measures to ensure that the facts presented in its news articles are accurate.

Disclaimer
The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.



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Lujan Odera , 2019-11-20 16:07:45 ,

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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.

Featured Image from Shutterstock


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

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