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Bitcoin (BTC) Price Analysis – May 23

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Bitcoin (BTC) Price Analysis – May 23

Key resistance levels: $8500, $9000

Key support levels: $7000, $6600

Rising from the 2018 low at around the $3150 on Bitstamp, Bitcoin market had dramatically climbed in the past few months following the significant cross above the daily 50-day moving average (orange band) in mid-February.

The positive move started to reveal clearly as the price action continued to respect the prominent 50MA, which was and still acting as a support for the market. The rally became more noticeable after the April 2 surge in volatility above the 0.236 ($4381) Fib. level and the important 200-day MA (red band).

While the cryptocurrency traded above the 0.382 ($5400) Fib. level, Bitcoin’s price further surge to the 0.786 ($7268) Fib. level before a slight drop. Meanwhile, a golden cross was signaled on April 23 as the daily 50MA broke through the daily 200MA.

After closing bearish at around the $6950 on May 12, Bitcoin breached the 0.786 ($7268) fib. level to the current 2019 all-time high, posted around the $8400 level.

From this above price level, BTC slumped below the 0.618 ($6386) fib. level due to the bearish surge that hit $6100. With immediate response, the bulls reacted to the sudden drop as they pushed price back above the $7000 before double-topping price the $8400 last weekend.

Since the retest at $8400 level, Bitcoin has remained subdued in the past three days of trading due to low volatility. Looking at the daily RSI technical indicator, the market is reflected downward after reaching the extreme overbought condition. Although, BTC positive climb was clearly revealed on the indicator since December 2018.

As of now, the buyers appeared weak. If the bears can pull price below the $7000, we may see Bitcoin fall to around 0.5 ($5767) fib. level, testing the daily 50MA.

However, the overstretched market needs a healthy correction around the $4500, the April 2 surge level before fueling the next bull-run, which is likely around the $8500 and $9000. A possible correction may meet support at the 0.236 fib. level, sitting on the 200MA.

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Bitcoin Heading to $100,000 as FOMO Yet to Start at $11,000

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As Bitcoin breaches $10,000 and crosses straight to $11,000, analysts anticipated a major FOMO that would create panic and thus attract more buyers. However, there seems to be no reaction from the public on Bitcoin’s triumph on the long-awaited $10,000. This has left the cryptocurrency community wondering what is going on. Well, The Crypto King has an answer.

In a tweet earlier today, the blockchain entrepreneur said Bitcoin will be moving straight to $100k because if at the current price no FOMO has started then the asset has a long way to go. Also, the fact that no extreme media announcements and headlines on the price are an indication that it has not been noticed yet and could be going much higher

According to The Crypto King, this is good for Bitcoin as it leaves more room for additional development, adoption, regulations and institutional money to flow into the market while it grows to $100k. Interestingly, he is not the only one having this conviction on the future of Bitcoin in 2019.

Veteran trader Peter Brandt is also convinced that Bitcoin is going to $100,000. Also in a tweet, Brandt said Bitcoin is experiencing its fourth phase since 2010, saying only Bitcoin has gone parabolic on a log chart in this manner in his trading career. As far as he is concerned, Bitcoin is the best market ever.

Keiser Report host Max Keiser has also been confident that Bitcoin would go to $100,000. He predicted this price in 2011 and has not gone back on his word since then despite the rough ride Bitcoin has been through. It seems Keiser finally has witnesses in the house who see things as he does.

If Bitcoin is actually going to $100k then only 10% of the journey has been covered and there is a long way to go for those who haven’t gotten in the train to do so. It is currently on a slight pullback but a trader says it is normal and expected so there is no cause for alarm.

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Huge Dump in Bitcoin’s Price May Not be Evident Again

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Veteran Venture Capitalist Predicts Bitcoin Will Fall to $0-$500 And Eventually Be Replaced

Bitcoin has exhibited a pattern in the past which can be said to be booms and busts in its price. There have also been similarities between the percentage of increment and decrement between certain years.

However, Bitcoin may not decline by 85 percent as is evident in the past, reports Bloomberg on June 13, 2019.

Similarities in Bitcoin’s Performance in the Past

Per the report, Bitcoin surged from $0 in 2009 to almost $150 in 2013 but later dumped 60 percent in price only to rebound to $1,150. In 2015, it declined by 85 percent to $175 which is considerably higher than its price in 2013. Similarly, it surged to $20,000 in late 2017 only to dump by over 85 percent in December 2018.

Therefore, if one considers the pattern, they can expect a sharp rise in the virtual asset’s price between $60,000 to $400,000 before it also dumps by 85 percent. While that may sound pessimistic, there are reasons to believe that the spike and sudden crash in price will not be the case this time around. So far, Bitcoin is currently trading at $8,600 and its year-to-date high is $9100.

Reasons Bust Percentage May be Lower

On the other hand, the previous performance might not be evident since Bitcoin’s market cap is not $152 billion which is larger than its $1 billion and $3 billion market cap in 2013 and 2015 respectively. Moreover, more people have ventured into space as well as companies. An instance is the case of JP Morgan who launched its own cryptocurrency.

Nonetheless, crashes can still be expected since volatility is prevalent even in crypto assets that have no value. However, they may not be as significant as in the past where the dump amounted to 80 percent. What can be expected, is something around 20 percent or less.

Bitcoin’s Options Market

While throwing more light on what may have led to its conclusion, Bloomberg made reference to the Bitcoin options market. According to the media, when cryptocurrencies prices in late 2017 were similar to what’s happening today, the $10,000 one-month Bitcoin calls had an active trading and implied volatility of 300 percent.

The latter meant paying $2,200 just for the right to buy Bitcoin at $10,000 when its price is $8,000. Another factor that was a consideration is the correlation between Bitcoin and the S&P 500 Index.

Generally, crypto assets correlate with the index due to their performance in good economic times with support for innovation and inexpensive capital.

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