Building The Case For A Potential Bitcoin False Bottom

Bitcoin price action is fickle lately, moving mostly sideways with a number of unsuccessful breakout attempts. The fact that $30,000 simply won’t break brings back memories of Bear

Bear market is defined as a decreasing set of prices for various types of assets. A bearish investor wants to profit from the movement of dropping prices. You can think of a bear, swinging his big paw downward on the investment, crushing prices.

The leading cryptocurrency by market did something similar after the June 2019 peak, settling in around late December, but then sweeping lows with Black Thursday before finally moving higher. Could these clues help build a case for a false bottom currently forming in Bitcoin?

Remembering The Bear

Bear market is defined as a decreasing set of prices for various types of assets. A bearish investor wants to profit from the movement of dropping prices. You can think of a bear, swinging his big paw downward on the investment, crushing prices.

The last four years of Bitcoin price action have been a rollercoaster, and among the wildest ones ever. A speedy rise from under $1,000 to more than $20,000 capped off the 2017 rally, and sent all of the market in the troughs of a Bear

Bear market is defined as a decreasing set of prices for various types of assets. A bearish investor wants to profit from the movement of dropping prices. You can think of a bear, swinging his big paw downward on the investment, crushing prices.

Price action grinded for months on end against the same support, but decreasingly lower highs – a signal of a downtrend. A lower low was finally formed in late November 2018, when Bitcoin broke down to its Bear

Bear market is defined as a decreasing set of prices for various types of assets. A bearish investor wants to profit from the movement of dropping prices. You can think of a bear, swinging his big paw downward on the investment, crushing prices.

From there, news about a potential Facebook-led cryptocurrency and the Bakkt cryptocurrency exchange drove the bullish narrative – and with it prices toward $14,000.

After the rejection, Bitcoin price action hovered sideways for another several months forming yet another false bottom. An 2020 rally broke the downtrend, but again a false bottom gave way when all of crypto crashed on Black Thursday.

Bitcoin Price At Risk Of Another False Bottom Fakeout

Bitcoin has once again found itself trading sideways, grinding against support that so far cannot be broken. Weeks worth of attempts have , and bears barely got a taste of below $30,000.

But that taste has bears salivating for more, and it is up to bulls to make sure Bitcoin doesn’t get there. The only problem is, the weekly Relative Strength Index has fallen to the level where in the past acted as the so-called “false bottom.”

When this phony bottom holds and a bounce follows, the rejection picks up enough momentum to get back through on the next attempt. The pattern fits the bill of an ABC correction, where the C wave is always lower than the initial correction A wave. B wave is in the opposite direction of the correction and may or may not have happened yet.

Will Bitcoin take another plunge through support eventually? What the cryptocurrency has on its side, is hope, and a rising trend line on the same Relative Strength Index.

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