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Bitcoin Plunges as Bears Roar, But Here’s Why Analysts Aren’t Too Concerned

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  • Bitcoin has seen some mixed price action as of late, with bulls attempting to push it higher yesterday before it saw a strong rejection that sent it tumbling lower
  • The crypto is still trading firmly within the trading range that it has been caught within throughout the past several weeks, and not much has changed from a structural perspective
  • Despite the apparent intensity of this selloff, one analyst is noting that he isn’t too concerned with BTC’s outlook from a technical perspective
  • He is specifically noting that there’s a strong possibility upside is imminent due to its rally stalling right before it tapped one key level

Bitcoin has been largely trading sideways throughout the past few weeks. Both bulls and bears have been unable to gain any firm control over the cryptocurrency’s price action as it bounces between lows of $30,000 and highs of $40,000.

Where the entire market trends in the mid-term will depend on which of these trading ranges are broken first. Flipping $40,000 from resistance to support would go a long way towards aiding in a continuation of its macro bull trend.

One analyst believes that this possibility will come to fruition in the near-term. He specifically thinks that a large triangle pattern BTC has formed will also result in a breakout, sending it soaring higher.

Bitcoin Faces Strong Rejection Following Test of $38,000

Yesterday, Bitcoin rallied higher during mid-day in the U.S., setting highs of $38,000 before its momentum stalled and it began drifting lower.

The selling pressure within the upper-$30,000 region has remained quite intense throughout the past several weeks.

The decline sparked yesterday quickly turned from a slight move lower to a full-fledged selloff that liquidated over-leveraged positions and cleared the crypto’s downside liquidity.

Bitcoin is now sitting around $35,000, trying to flip this level back into support.

BTC Holds Key Level Despite Selloff: Analysts Expect Upside 

One analyst mused the possibility that Bitcoin is currently trading within a large pennant formation, with the overnight decline marking a test of the lower boundary of this historically bullish pattern.

“BTC 4h: Imo there is no reason to speak about a bear market. We are about to hit a 5 weeks trend line support. Even if we lose it we are still inside of the more important bullish pennant,” he said.

Bitcoin

Featured image from SilverBullet. Source: BTCUSD on TradingView.

When this pennant does break, it will likely cause Bitcoin to see a hard and swift movement in one direction or another.

Featured image from Unsplash.
Charts from TradingView.





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Dogecoin, CryptoCurrency Reddit communities surge as crypto euphoria heats up

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With much of the market fixated on Bitcoin’s (BTC) sudden price correction over the weekend, retail interest in digital assets appears to be on the rise, according to the latest statistics from Reddit.

The r/dogecoin community added 145,859 weekly subscribers, according to Subreddit Stats. The gains are hardly surprising given DOGE’s dramatic rally over the past week. The meme-based cryptocurrency skyrocketed 400% during that period, bringing its yearly returns to an eye-watering 5,000%.

DOGE’s parabolic rally moderated over the weekend, with social media sentiment data from The TIE and Cointelegraph indicating more pain in the short term. That’s because price action is often correlated with social media engagement; a decline in the latter is sometimes a precursor to bearish price action in the near term. 

Meanwhile, the r/CryptoCurrency community, which is devoted to all things digital assets, added 86,838 new subscribers during the week. New community members were welcomed by platinum award recipient “mirza1h” on Sunday. In a subreddit post, miraza1h said:

“Past week has been insane in the crypto world, so naturally things here weren’t like they normally are. Your curious posts/comments may have been ignored a bit. In the weekend things are a bit more chill, so feel free to ask us anything you want.

The user also introduced new subreddit followers to Moon, the native token of the r/CryptoCurrency community.

Much like DOGE, the overall cryptocurrency market limped into Sunday’s session, having declined by a cumulative $386 billion, according to CoinMarketCap. The digital-asset market cap briefly fell below $1.9 trillion before recovering to around $2 trillion.

Massive shakeouts are nothing new for seasoned cryptocurrency investors. Even during bull markets, declines of 20% or more are fairly common, especially after major rallies. Speculation about an abrupt decline in Bitcoin’s hash power and the possibility of U.S. regulatory action against crypto-friendly banks may have contributed to the decline on Sunday.

Even with the latest decline, the cryptocurrency market is still double the size it was in January when it first crossed the $1 trillion milestone.