Once again, the price of Bitcoin (BTC) has started to flounder, trading at $7,150 as of the time of writing this after reaching as high as $7,800 last week. The trend, once again, implies that the cryptocurrency market may start falling again to end the year off on a bloody note.
Though, an analyst who called the recent decline to $6,600 seems to believe that the tides are changing in the favor of Bitcoin bulls. Here’s why.
Bitcoin to Bounce Into Halving?
Velvet, an analyst who called the strong drop to the downside when Bitcoin was trading at $8,500 just weeks ago, recently noted that the crypto traders calling for BTC to go sub-$6,000s are being irrational, calling such prices levels “unlikely to happen.” The reason, there are key supports in the low-$6,000s to mid-$6,000s range: a moving average that BTC bounced off of in April 2018, the price that is two times the $3,150 bottom, and a logarithmic uptrend support line that has held for the past three and a half years now.
That’s not to mention that the three-day Relative Strength Index (RSI), which tracks the severity of market movements to determine if an asset is categorically “overbought” or “oversold,” is on the verge of bouncing off historical support levels into the halving. Also, the three-day Stoch RSI is putting in a bottoming pattern, implying upside is likely in the coming months.
$BTC $BTCUSD #BTCUSD
Thread 1/2Despite my broken thumb I managed to make this chart. Cuz bored..#CT calling for sub 6k.. but that's unlikely to happen imo.
Why?2x support + halving FOMO = UP
Of course when BTC starts to rally.. you all gonna say that you saw it all coming. pic.twitter.com/Lsz4qsyuPK
— ᴠᴇʟᴠᴇᴛ 🆙 MAXi 🌍 (@888Velvet) December 3, 2019
Velvet didn’t give an exact target, though his chart (seen above) implies that the cryptocurrency will be trading at $10,000 around the time of the block reward reduction, also called a “halving,” in May 2020.
While it seems that the Bitcoin price is likely to find support in the near future, one prominent analyst has asserted that the cryptocurrency is not yet in the clear. Tom DeMark, the technical analyst and prominent investor behind the much-lauded TD Sequential indicator (which called the Bitcoin bottom in December 2018 and the top in December 2017), said to Bloomberg that his firm is currently charting a move in the BTC price to $6,308 — some 15% lower than current prices — with a current max downside of $5,294 in a crash-like scenario.
Fundamentals Hint at Crypto Bounce
The fundamentals, countless analysts and industry investors have suggested, back the bullish narrative. Speaking to Bloomberg in a recent segment, Blockchain Capital’s Spencer Bogart remarked that the fundamentals suggest Bitcoin still has long-term upside potential.
He specifically looked to the fact that Bitcoin continues to process “$1 billion to $3 billion worth of transactions daily,” which is a far cry from when the cryptocurrency was deemed “a joke” just years ago; the growth in and adoption of a number of Bitcoin and cryptocurrency fiat on-ramps into the industry; and the positive perception placed on Bitcoin by young Americans, as found in a survey his company conducted earlier this year.
Featured Image from Unsplash