The amount of $3,740: that was Bitcoin’s price at the time of writing this piece, down 2.14 percent from what it was 24 hours ago. No matter how many steps forward the market takes these days, the backward ones seem to be even more. A few days ago, it looked like it was going to finally surpass the $4,000 barrier again, but it dropped yet again.
Since January 2018, when BTC was trading at nearly $20,000, all that the world’s premier cryptocurrency has done is alternate stability periods with downturns in value. The lowest point since that month was a little under $3,200: could it be that Bitcoin falls even further than that?
BTC Cannot Break through
The period that started on January to this date (a two-month span) has seen Bitcoin’s price hover around $3,200 and $4,000, and its inability to break through crucial resistance levels over $4,200 is worrying. It is important to high light that, the September 2018 – November 2018 timeframe was similar when it comes to market behavior: it moved between $6,100 and $6,700 before collapsing to less than $3,200 in a matter of weeks.
The situation has caused some traders in the community to speculate on what would be next for Bitcoin: a sizable number of people within the industry think that the leading digital asset may be vulnerable to a similar slide in the short-term if it does not begin showing momentum soon.
Momentum is Everything
Of course, what happened in the past should be no clear reference to what the future may hold. However, it serves as a standard or reference to speculate on what could happen this time around.
The account @Sawcruhteez (Financial Survivalism) made its sentiments clear via Twitter in the past few days. “The longer we stay stuck in this range the more I feel like we will mirror the price action from September 20th, 2018 – November 25th, 2018.” That was the timeframe in which Bitcoin’s price fell from the $6,000 range to the $3,100-$3,300 range, and before that, in last year’s first few months, it has already lost 70% of value.
The worry around the industry is that BTC’s price has not yet hit rock bottom. The past five corrections have seen its value fall about 85% on average from its historically highest point, and that is the moment when a bottom is found and when an accumulation process begins.
As a member of the online community of analysts, nicknamed “Hsaka”, points out, BTC price chart suggests that it has impressive resilience from steep corrections, and has a notable ability to show recovery in longer timeframes.
Jeff Sprecher, who is the Chairman of the New York Stock Exchange, observed that in spite of the crude and long bear markets that BTC has had to endure in history and the rise and popularity of other digital assets with seemingly better infrastructures and technologies, Bitcoin’s survival ability is still unmatched.
“Somehow bitcoin has lived in a swamp and survived. There are thousands of other tokens that you could argue are better but yet bitcoin continues to survive, thrive and attract attention.”
Four years have passed since 2015 and the world’s premier crypto asset has consistently shown higher year lows. If the trend continues, the odds are high that BTC will not fall further than the 2018 low of $3,200 by the time the new year comes around.
By Andres Chavez