Bitcoin News

Has the market started to decline? Some digital currency analysts warn


The 40 percent drop in the price of Bitcoin to its historic high has led many analysts to take differing and largely contradictory views of the current trend of the digital currency. While some say the uptrend has remained intact, others believe that Bitcoin has entered a downtrend.

to the the report Bitcoin Telegraph, the price of Bitcoin reached a peak of $ 64,850 on April 14 (April 25). Many top analysts at the time promised $ 100,000 in bitcoin. It was then that the price of Bitcoin showed signs that the uptrend was likely to end.

Weekly Bitcoin Price Chart
Weekly Bitcoin Price Chart

During the 37 days after the record high, the price of Bitcoin lost 50% of its value and fell to $ 30,000. This was the worst fall of Bitcoin since March 2020, known as Black Thursday.

At present, some analysts, citing various indicators, say that the price floor was $ 30,000. Others say the digital currency’s inability to recover strongly from increased sales indicates that it is more likely to fall.

David Lifchitz, one of ExoAlpha’s senior executives in the field of investment, recently gave an interview to Coin Telegraph, which we have prepared for you below.

Question: What made Bitcoin go downhill? [سقوط] And what do you think got the situation out of control?

Leifchitz: Last week, just a few hours before Elon Musk’s noisy tweet about Bitcoin, we warned that the probability of a fall is greater than the probability of a rise; Because the lack of an ascending catalyst was evident in the market, and as we saw, we faced it.

Believe it or not, on May 18, we said that when we look at bitcoin in weekly timeframes, we see an ugly pattern on the head and shoulders with a neckline of $ 45,000. The left shoulder roof was formed in the week ending February 8 and was over $ 60,000 in the week ending April 5. In this pattern, the right shoulder was formed the week ending May 3.

Question: Why did this head and shoulder pattern become a problem?

Leifchitz: The price of Bitcoin fluctuated in the range of $ 43,000 and just below the neck, which is not considered a very healthy situation. The result of this pattern is usually expected to be a downtrend. The size of this descent is usually equal to the distance between the neck and the roof of the head, which were at $ 45,000 and $ 60,000, respectively.

This meant that it could fall to $ 30,000. This is where the Bitcoin price stopped and was supported during its 2020 ascent. It was just a technical and probabilistic analysis, but nothing guaranteed a return of $ 30,000. Falling below $ 50,000, a level that had previously acted as support, severely weakened the bitcoin position in the short term.

In addition, Bitcoin Gray Investment Fund had a high price difference with instant exchanges, which increased the pressure on the Bitcoin market. Gary Skill does not appear to be taking any immediate action to reduce this price difference. We do not go into too much detail about this.

Question: Were institutional investors or micro-investors behind this fall?

LeifchitzThe head and shoulders pattern we talked about, which had a $ 30,000 down target, worked very accurately, even though it happened very quickly.

This seems to have put an end to a period of months of irrational uptrends and the madness of the Six Coins of every class.

So far, the $ 30,000 floor has been raised to $ 38,000 and now acts as a new resistance at $ 40,000. It remains to be seen how the Asian market reacts and then how the American time zone responds to what happened on the other side of the world.

If we compare the fall of May 19, 2021 with the massive sales of March 13, 2020, we can see that the current price floor quickly faced a massive purchase, while the price floor of 2020 only lasted one day in this way. This indicates that there are more short-term traders in the market than last year who use automated trading tools.

What made the market so popular? Certainly the high volume of sales pressure had caused this to happen. In this, some may think that Elon Musk has finally sold Tesla bitcoins, or others may say that Gary Skill has sold out to meet the demand of large-grain investors. In any case, no one knows.

.

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button