Sorry bulls, bears may be about to take control of the Bitcoin market once again.
Despite Short-Term Uptrend, Bitcoin May be Ready to Return Lower
Over the past few weeks, the cryptocurrency market has seen a flurry of volatility; BTC has traded at $6,600 and $7,800 and everywhere in between over the past week, despite some analysts, like Mike McGlone of Bloomberg, expecting for volatility in the price of digital assets to subside heading into the end of the year due to the launch of Bakkt and other products that may increase liquidity.
As of the time of writing this article, the trajectory for Bitcoin seems to be slanted upward, with the leading cryptocurrency having started to build bases of support at $7,000, then $7,400, and most recently at $7,800 over the past 72 or so hours.
While many see this staircase upward trend as entirely bullish for BTC, a popular trader going by “Majin” noted that the price action seen since last week is eerily similar to that seen during December 2018, when Bitcoin found a macro bottom in the low-$3,000s.
— Majin (@majinsayan) November 30, 2019
More specifically, the drop to the $3,000s was marked by a vertical decline, quick recovery, a staircase uptrend, then a second dump to set fresh lows, then an eventual recovery. This time around, Bitcoin has seen the first three play out. If the history pattern plays out in full, BTC may soon return lower, to set a new trend lower likely in the low-$6,000s or the high-$5,000s ranges.
While many are skeptical that this plays out, especially due to the uptick in institutional interest seen in the Bakkt futures’ volume reading, there is some other evidence to corroborate the idea that Bitcoin may be ready to return to the $6,000s.
One such piece of evidence is a fractal, which is when the historical price pattern or direction of an asset is reflected/seen again on a different time frame and/or for a different asset, pointed out by prominent cryptocurrency trader NebraskanGooner.
The all knowing fractal says the top is likely in for now.
Trend line breakdown retest looks completed.
Will be interesting to see if this continues to play out. pic.twitter.com/Bs1xQHZdoV
— NebraskanGooner📈 (@nebraskangooner) November 29, 2019
Featured Image from Unsplash