Bitcoin May Be In The Verge Of A Plunge, Analysts Warn
Save for yesterday’s cost action, the movement in the value of Bitcoin throughout April has been instead bullish, leading analysts across the board to declare that cryptocurrencies are finally entering their next bull run. However, once yesterday’s news regarding Tether and Bitfinex found light, resulting in a fast 10% drop from $5,550 to $4,950 in BTC, analysts have begun to assert that a move lower might be likely.
Popular analyst Nick Cote explained that Bitcoin’s three-day chart has seen a bearish engulfing candle, BTC broke under its “range trend line,” and the Stoch Relative Strength Index (RSI) reading has begun trending lower, signifying that bulls are losing hold on the marketplace. Cote did perhaps not mention a specific Bitcoin prediction, but he did quip “make your bull case, I’m listening,” done in an evident attempt to quash optimists’ hope.
Cote wasn’t alone in his belief that cryptocurrencies are poised to head low in the long run. HornHairs, another well-known trader, noted that in the past five years, so effectively many of Bitcoin’s life as a tradable, liquid asset, the two-day BTC chart has only seen five accounts of bearish RSI divergences. Today, per HornHairs, will “mark the sixth” time that this technical trend has been seen. This will be notable, as on average, Bitcoin fell by 44.25% after these divergences were confirmed. For a few viewpoint, a 44.25% fall from present levels would place BTC at approximately $2,900, below its yearly lows of $3,150
Of course, historical action isn’t exactly indicative of future performance, but a precedent is set for at least a slight move lower, and some others would agree.
As reported yesterday, trader Financial Survivalism believes that this move confirms that Bitcoin’s present market structure is like that seen in December’s downturn, but inversed. In fact, the current action within the TD Sequential and Relative Strength Index (RSI) indicators looks nearly identical to that seen in early-December but entirely inverted. Thus, if history is followed, BTC may be poised to notice a $1,000 pullback, potentially to the $4,200 range.
Some, however, have attempted to stay hopeful. In a Twitter post published on Friday early morning, popular trader Josh Rager noted that he believes that Bitcoin could rally to $6,300 within the near future to meet a level of key resistance, in spite of the recent Tether debacle. Rager’s recent remark employs he stated that as
BTC has constantly established higher lows without fail over the past few months (save for Thursday), the cryptocurrency could rally up to a “peak interest area” close to $6,400.
Also if this rebound doesn’t come to fruition as Rager expects, many investors’ long-term theses on Bitcoin remain unchanged. As Ikigai’s Travis Kling explains, there is “plenty of uncertainty” around Bitfinex, but over the medium and long-lasting, he is “unequivocally bullish for the room.”