There is a shaky, unsure and fearful atmosphere in the market with the price of Bitcoin hanging below the $8500 mark for the past 72 hours.
Everyone has been talking about Bitcoin crossing the $12,000 mark to potentially enter into the “bull” run criteria. $12K, as of today, seems far-fetched considering the last time Bitcoin was at $12,000 was on January 21st this year.
All chart indicators until the day before yesterday revealed a possibility of Bitcoin staying above $8500 levels and going back up to 11K.
Today’s revelation from a lot of different sources predicts Bitcoin dropping to below $7000 level, possibly even breaking lower than early February levels of $5900.
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Historically, the 200-day Moving Average has met with the 50-day Moving Average back in 2015 when the markets were still young and tender while the Bitcoin prices were hovering around the $300 mark. Although these key indicators have not yet met, they are very close to meeting.
Everything from Dow Jones to Nasdaq has closed the past two days in a low and analysts feel the long impending doom of the market would probably happen now. Many argue that the two days low was only due to Trump’s China trade decision.“The unemployment rate is at an all-time low in America, we have people who are paying premiums for goods worth no value. We have had a good run since 2008 but there will be a pullback and it could be now, the past two days are indications of a tired market.”
Kenneth Yanger, a Bitcoin evangelist and miner says,“They say Bitcoin is a bubble but if you look at Nasdaq and other ‘trustworthy’ stocks, everything looks like a bubble. If what we are seeing right now is an actual stock crash which can be confirmed if this continues on for the next 48 hours then it will be very interesting to see how Bitcoin reacts.”
The markets however at press time on Monday late night had seen incredible recovery with the biggest single-day gain since 2015 because of the improved mood in Wall Street after the decreased tension of a trade war between US and China.
Bitcoin at press time was trading at $7940 to a token with a market cap of $135 billion experiencing a 5% drop since yesterday. Many have argued about the co-relation of stock markets with the crypto market. Although people from the community believe that the crypto market would not be influenced by stock markets, many analysts say that there has never been a real-case scenario to test this theory.
Karen Mejia, a hedge fund manager from New York who recently started his Bitcoin Fund Managing company says,“Don’t look for connections where there are none. Crypto markets and Stock markets have so far been separate entities. If we see the stocks crashing this year then that would be the real test of Bitcoin. What we have seen so far is a very reactive, immature crypto market with a lot of weak hands but one things is sure – Bitcoin is a cockroach, will never die.”
Alex Philip Lucas, Operation Specialist at Stock X says,“If we had a co-relation then Monday should have been either bullish or bearish. It was a nothing day with just a 5% loss which is normal in the crypto space. The death-crossed has scared people shitless; it really doesn’t matter if the cross happens and if we drop below 6k, buy cheap because it is going up again”
Only time will prove if Bitcoin can hold its position when the stocks crash (if it does). Will “smart money” park their money in gold, silver and bitcoin? If they do then analysts say it could possibly lead to the biggest bull run that the cryptocurrency market has ever witnessed. Although the regulators are calming down and there has been positive news from G20, analysts say that they are still waiting on a trigger which could lead the bull run.
John McAfee in his recent tweet says,“…..In the long run, crypto will not go away. It will not burst. It will not be shut down. It will not be controlled or constrained by government. It is here. To stay.”
The current sentiment is still bullish and despite the dramatic drop from the $11,700 price earlier this month and multiple bloggers/YouTubers with ‘daily analysis’ predicting a crash which could head down to $6000. Many from the community call this current crash from $20K to the current level “healthy”.
Arleen Meida, a consulting partner at SAP and a crypto fanatic says,“Healthy markets hypothetically means market penetration. Need bigger hands selling like the Mt. Gox guy. It doesn’t matter if the market is correcting right now because of profit-eating whales who invested very early on like in the 2015 era are selling. It will just mean that future bull runs will be more sustainable.”
With a slight curve towards the uppish side in the 50-day MA at press time, the question begs, will the market see more selling pressure down towards $6000? Or are the sellers tired and would the market see some bullish action till the $10K mark? If we do then there would be no “death-cross” but if the price lingers around the $8k or heads lower then it’s possible that we are entering into a bear market which could last for a couple of months.