July 19th (Reuters)-If you’re waiting for Bitcoin to recover, you may have to sweat for months. That is the conclusion of some technical experts seeking a way out of madness.
Bitcoin slides since May have been overwhelmed by economic instability, below the 200-week moving average of about $ 22,600 and the 200-day moving average of about $ 35,500.
It has been moving relatively sideways for over a month now, approaching the 200-week moving average.
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Valkyrie Investments, for example, states that the survey shows an upward move, but it’s not clear at some point.
“Historically, it’s been accumulating for three to six months (on average, about 200 weeks),” said Valkyrie’s head of research, Josh Orzevic, referring to the sideways trading period before prices rose. ..
From late 2018 to early 2019, Bitcoin spent nearly three months on a 200-week moving average.
But in a darker scenario, Bitcoin may not recover for about a year, Olszewicz added.
Moving averages are an idea to smooth out wild price fluctuations to clean up the signal, or at least that’s the idea. Traders use longer date averages to find the next support or resistance level.
However, chart analysis based on historical price patterns is far from accurate science, especially when it comes to the young, fast and ferocious history of cryptography.
Several other technical indicators show that the potential level of Bitcoin support ranges from $ 20,000 to $ 12,000. This suggests that the world’s largest cryptocurrency may plunge anew.
The expression of Bitcoin can be seen in the illustration photograph taken at La Maison du Bitcoin in Paris, France on June 23, 2017. REUTERS / BenoitTessier / File Photo
Bitcoin is slightly above its 2017 peak this week, but more than 68% below its November record high of $ 69,000.
“4 steps down, 1 up”
Some people have seen patterns in the recent slump.
Eddie Tofpik, Head of Technical Analysis at ADM Investor Services International, said: “It seems that we are currently in 4 steps down and 1 step up modes.”
Patrick Reed, co-founder of Fx Consultant’s Adamis Principal, said the Fibonacci retracement pattern aimed at identifying levels of support and resistance was a modest level between $ 19,500 and $ 20,000 for Bitcoin. Suggests that you have found support.
Valkyrie’s Olszewicz points to $ 12,000, and as the next support, Level Bitcoin hasn’t been mentioned for nearly two years.
In the absence of basic impetus, technical analysis has proven to help identify long-term trading patterns for cryptocurrencies such as Bitcoin.
For example, the famous “Desk Loss” chart pattern on December 10 foresaw a subsequent plunge in Bitcoin. In early January, the 200-day moving average showed strong resistance.
Such a method is also dangerous, as evidenced when the explosion of Stablecoin TerraUSD and its pair token Luna, and the subsequent hedge fund Three Arrows Capital, caused crashes in all cryptocurrencies this year. ..
Cryptocurrency spot trading on major exchanges fell 27.5% to $ 1.41 trillion in June, the lowest level since December 2020, according to data from research firm CryptoCompare.
“Trust has come out of the market a lot,” said Adamis Principal Reed.
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Report by Lisa Paulin Matakkar and Meda Singh of Bangalore. Edited by Vidya Ranganathan and Pravin Char
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The expressed opinion is that of the author. These do not reflect the views of Reuters News, which under the principle of trust, are committed to integrity, independence and freedom from prejudice.
