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Bitcoin Nears $7,800 Just After a 3-Week Low with Further Gains Expected

Bitcoin Nears $7,800 Just After a 3-Week Low with Further Gains Expected

Published: December 23rd, 2019

– Ever since the price of Bitcoin jumped from $220 to $1200, back to $230 and eventually to almost $20,000, all in months, the cryptocurrency’s price swings never surprise industry players anymore. The latest currency slump that preceded almost seven days of a no-price action had been scary. However, hitting a 3-week low in the face of an approaching Block Reward Halving was way scarier, even with a predicted bull run. The gains in the Last hours could be the result of the manifestation.

The cryptocurrency prices, volatile as they are, are discernible after all. Last week as the price of the world’s first cryptocurrency seemed to be headed in a steep dive, a section of the market held hope. The said market segment was even bold enough to predict a bull run. And, after almost seven days of little price swings, the cryptocurrency has surged past the $7,500-mark almost hitting $7,700 early Monday, December 23, 2019.

Bitcoin looks set to sustain the price going into 2020 trading at above $7,500 the entire early Monday morning, only receding below this line for about an hour between 6:40 a.m. and 7:25 a.m. UTC.

According to Michaël van de Poppe, a contributor at the renowned crypto magazine, Cointelegraph and a trader at the Amsterdam Stock Exchange, the Bitcoin outlook for the last week of the year and the first few weeks of January 2020 are terrifyingly bright.

Tweeting late on Sunday, December 22, van de Poppe added that the bullish signs the cryptocurrency showed were indicative of another push to the resistance region between $7,800 and $8,000.

A move into the region van de Poppe predicts would mark a rally of 5% based on the prices of the last 10 days of the year.

His sentiments were seconded by another trader called Mac (@MacnBTCon Twitter) who said that with a resetting Money Flow Index, the Bitcoin price moving ever closer to the $7,800-mark is very likely. He added that since the $7,800 and $8,000 represents the liquidity pool, the first few weeks of 2020 paint a rosy picture for Bitcoin if it succeeds to get into this zone.

Breaking the Prolonged Sideways Trading?

Before the latest jump, the cryptocurrency managed a massive surge sometime in June 2019, moving to $12,561. The gains, however, bled in the following months. There, however, were modest increments, then cryptocurrency seemed to comfortably settle into a prolonged sideways trading bout. The said period that followed a slump of sorts, convinced market analysts of a continuance of the downward spiral. Industry experts now think this recent rally could signal a trend reversal.

Would $6,400-mark Become the Long-Term Bottom?

The trading range came with an upward movement that, seemingly, has some very decent strength. If that is verifiably true in the next few days, then the $6,400-mark the currency traded in November 2019 could be the long-term bottom.

Big Cheds, a cryptocurrency analyst at CNBC Africa’s Crypto Trader and YouTube Vlogger agrees that the increase, as well as the sideways trading of the past few days, is indicative of a potential long-term reversal. However, he adds that this is only certain if the cryptocurrency holds on to the current rates going into the first week of 2020.

The good thing, Big Cheds says, is that the trend in the few hours of Monday, December 23, 2019, is enough to offer adequate insights into the direction the aggregated markets would assume both in the short and not so very short-term.

Not Everyone is Convinced

Despite the impressive surge, the fact that the currency has sustained two surges in quite a short term, with the first not attaining much, some industry traders skeptical. A financial markets trader known on Twitter by the handle @SalsaTekila says that the current surge could be a “Bitcoin Bull Trap,” and nothing more.

To support his argument, the trader says that since the currency is getting into a high time frame liquidity pool, a Bitcoin rejection from the $7,600 price mark is possible. If such an action indeed happens, then a potential price collapse back to the neighbourhoods of $7,000 is very possible, maybe even lower into the $6,800 to $6,950 region.

Joel (@JofDom on Twitter), another analyst that holds a similar opinion, recently did a tweet that showed the correlation between current price action and the scheduled monthly expiry of CME Futures.

The data he provided shows that Bitcoin tends to experience a price decline the week ahead of the expiry of every CME Futures derivatives issued out in the past. According to this data, the average loss often fluctuates at around 2% in the seven days that precede the expiry.

If this prediction is true, then the Bitcoin price may not hold at the $7,500-mark for longer, and instead, will slide as the expiry date of December 27, 2019 nears. And, with 2% being the average, there is a possibility that the expiry of the CME Futures may bear more harm to Bitcoin in the last week of 2019 and the first few weeks of 2020.

Another popular crypto trader, Cantering Clark seconds these sentiments. He says that the price of the crypto mirrors the trend in late-October that followed the announcement by announcements by the Chinese president Xi Jinping backing the Blockchain. During the said time, Bitcoin rose to a high of $10,000, then later bled.

Noting the similarity, another popular cryptocurrency analyst Josh Rager (@Josh_Rager on Twitter) said the few hours of the jump are not enough to define a bull run. He said that unless the crypto breaks the $8,000 resistance, it is not wise to rule out a reversal rally. He adds that should such a rally happen; its effects may be devastating.

In Summary

The Bitcoin price surged going to the last week of 2020. This is great if it is indicative of a bull run. Coming only months before a schedule Bitcoin Block Reward Halving, it could have many explanations. One thing, however, it that it is good news to the optimists. Skeptics? Well, not so much.