Before a valley is formed, the volume drops to a value lower than the daily average. Although the analysts were correct about the beginning of the valley, the minimum point was advanced several months
After the occurrence of major landmarks in the crypto market, many analysts give detailed explanations about the reasons for Bitcoin’s price behavior. Regarding predictions, which are also abundant, they are supported by traditional trading tools or the tone imposed by the bullish or bearish trend of the moment.
In view of the current boom of BTC, this article addresses one of the right predictions about the recovery of Bitcoin’s price made by The Crypto Fam, which predicted the formation of a valley a year ago, when BTC was in the vicinity of US $6 thousand.
In 2018, when BTC collapsed and corrections were needed, according to some analysts’ view, some predictions were made that, although not exactly fulfilled in terms of dates, were consistent with regard to the occurrence of a valley that would lead to the recovery of Bitcoin’s price.
Valleys in the Bitcoin Price
Experts say that there are two ways to appreciate the evolution of Bitcoin’s price: the classic one, on a linear scale, and the one that uses a logarithmic price scale, in which each scale division is ten times greater in magnitude than the previous one. They explain that the first scale highlights the boom of 2017, when Bitcoin reached its historical maximum at the end of that year, and its subsequent fall and recovery in 2018 and 2019, respectively.
Exactly one year ago, when BTC was around US $6,500, the consulting company The Crypto Fam analyzed the most outstanding features of the valley that occurred in BTC’s price between December 2014 and November 2015. This occurred after the dissolution of the bubble in December 2013, when Bitcoin’s price reached a maximum slightly higher than US $1 thousand.
The dynamics of the formation of the valley was examined and several outstanding elements were identified, such as the fall in the daily volume, which is explained by the intensive sales that are made after an abrupt fall and a stage to which it has been referred as “slow bleeding”, from that maximum of US $1 thousand to the vicinity of US $250 one year later.
Analysts have raised the question of what other sign could mark the beginning of the moment in which Bitcoin hits bottom. This cryptocurrency remained in “the bottom” almost all year 2014, but what is important is the fact that it enters a depression zone or a dormant phase, in which it continues falling to a volume lower than the daily average.
Although the date on which the valley would occur was not predicted (for instance, the minimum of December 2018 was not anticipated), the analysis succeeded in predicting arrival at the bottom, with the data available in June 2018. Regarding its probable dates, beginning and ending of 2019, Bitcoin hit the bottom before, on December 15th, 2018, when it reached US $3,200.
Statistical analyses of the prices of cryptocurrencies, like the one performed by Crypto Fam, can help investors feel more confident as they can predict the best moment to invest.
By Willmen Blanco