Is There a Bitcoin Bull Case After 10% Plunge to $7,400?
On Wednesday morning, Bitcoin bears finally managed to get the upper hand over bulls.
For those who missed the memo, the leading cryptocurrency’s price fell by 8% or so within a few hours’ time, falling from above $8,100 to as low as $7,400 in a dramatic blow to bulls. In fact, this move saw hundreds of millions of dollars worth of leveraged longs on BitMEX liquidated. Ouch.
Due to the dramatic nature of this move, coupled with the expectations that Bitcoin was starting to trend green once again, analysts are expecting for bearish continuation.
So, is there any hope for bulls? According to a number of analyses, just maybe.
Bitcoin Bear Momentum Already Paused
One notable bullish argument is that the sell-off, by many measures, wasn’t as dramatic as a capitulation event. As analyst BTCKyle pointed out, volume was actually rather low on the drop as low as the days of non-action before. This simple sign helped Kyle come to the conclusion that bears’ $6,000 price targets are unlikely to be entertained.
I don’t believe your $6,000 targets will be entertained…
I believe we are nearing the end of this downtrend.
Divs… low volume on this latest selloff…
DYOR, but I’m looking to scale in between now and the high $6k range (which I think would be hit for a micro second) pic.twitter.com/1m1e8laLQ7
— BTCKYLE (@BTCKYLE) October 23, 2019
That’s not all. In a thread building off the above tweet, the cryptocurrency trader noted that Bitcoin is currently seeing a bullish divergence, with the RSI trending higher as the price of BTC has dropped. This implies a further recovery.
Another bullish argument is the fact that in the previous market cycle, Bitcoin experienced similar price action to what the cryptocurrency is seeing now prior to the start of the long-term bull trend. As Nunya Bizniz pointed out, a “move below the 100-week moving average” marked “the beginning of a stunning rise.”
Will this move below the 100 week MA, mark the end of a bull run?
Prior cycle (I know only 1 sample) says no.
It actually marked the beginning of a stunning rise.
Grasping at straws with these MA fractals? pic.twitter.com/sjyXiaHjfr
— Nunya Bizniz (@Pladizow) October 23, 2019
Still Bullish Above $7,100
Also, trader Mr. Anderson has noted that as long as Bitcoin remains above $7,100, which is where the 89-week exponential moving average lies, the asset remains in bulls territory. He said that losing this level would result in “DEEP BEAR.”
$BTC Destiny update
Spot came within about $70 of its seemingly Destined Yrly TWAP touch as discussed in early October
The 89 week-ema is currently at about $7100 depending on the exchange. This is a number that Bulls must hold on a weekly closing basis. pic.twitter.com/g4AZPTV4OV
— Mr. Anderson (@TrueCrypto28) October 23, 2019