It took one excruciating week, but Bitcoin bulls gradually recovered from a battering by voracious bears, which had driven the digital asset’s value down below $9,500. The analyst community had soured on the token’s sensational past and had consigned itself to waiting for another visit to the lower realms below $9,000. Several reasons were proffered to support such a track, and by repetition alone, the group had convinced itself that way down south was inevitable. As has been the case in the past when technical analysts swore that their pattern recognition skills could not be denied, Bitcoin rebelled.
Yes, once again, our band of technical gurus misjudged the power of current support for the world’s favorite digital asset. Every chart line, pattern, and historical viewpoint pointed downward, but BTC refused to obey, at least for the time being. Wednesday, a week ago, Bitcoin had fallen from its $10,000 support perch, which had provided comfort for weeks on end. It had benefited from an infusion of capital from institutional investors and those folks that saw a “safe haven” potential in the coin, but these cash flows can easily reverse, perhaps, what took place last week.
From an analyst’s perspective, the overarching technical imperative for a fall from grace came when Bitcoin penetrated its 200-day moving average (see chart above). More downward moves would bring the 50-day MA into the picture, and if and when it crossed the 200-day MA, an event known as a “Death Cross”, dour expectations would surely spoil the day for every Bitcoin enthusiast on the planet. A host of skeptics smelled blood in the water, but bears did not capitulate. Bitcoin moved up.
Declining volumes and a leveling in the RSI indicator sent a modicum of hope through BTC hodlers’ veins. Perhaps, the considerably long ranging period was due to a period of seasonality. Current changes may have been an un-winding of capital flight that had buoyed Bitcoin prices for a bit, but both answers would wait, as analysts and investors returned to their respective desks this week from extended holidays.
Not everyone in the analyst community is negative at the moment. There are quite a few that claim to be holding their breath in anticipation of a major breakout. Price patterns appear similar to last December/January in their estimation, just before the recent five-month long “rocket trip”. These same folks are warning investors that this may be the last time to buy at sub-$10,000 levels (as I write, BTC has rushed past $10,250 in a flash).
On another positive note, major altcoins are moving up, too. Investors’ risk appetite must be increasing. Last week was a brutal one for the top four tokens, as measured by market cap: BTC: -4.5%; ETH: -10.5; XRP: -4.5; and LTC: -12.1. If you happened to check the next one hundred programs, only roughly one out of seven programs recorded a positive return for the week. A “churn” was taking place, as investors began re-thinking their positions, once equities had re-bounded from trade war fears.
Apparently, the quick positive turnaround today has sparked enthusiasm on the part of Bitcoin advocates. One crypto trader by the name of Luke Martin (aka “VentureCoinist”) immediately informed his faithful following that BTC would cross $10,300 in 24 hours. Then CoinTelegraph followed with a quote from Peter Brandt, another noted crypto trader, after he had tweeted on Sunday:
Possibility that $BTC has entered fourth parabolic phase.
Several articles have also appeared today, touting the benefits that the Bakkt exchange will soon bring to the price behavior of our beloved Bitcoin. It is amazing how a nice bump north in the morning can brighten one’s day.