Bitcoin May Be Poised To See Pullback
On Thursday, Bitcoin (BTC) began to rally massively. After trading under $5,300 for a week as a result of the Bitfinex and Tether news, the cryptocurrency began to push past key levels, somehow reaching $5,800 by Friday. Some fear that this move came to quick, however, meaning that the digital asset market may be poised for a pullback.
Statistical crypto analyst, Awe & Wonder, broke down the reasoning for this belief. He noted that Bitcoin is currently mirroring a historical trend to underperform its logarithmic regression trend line, which sits around 40% higher than the current value of BTC. While there is an opportunity that the asset pushes to and past that trend line, the analyst notes that if historical precedent is followed, BTC will pullback and remain under this key level for the foreseeable future.
#BTC is mirroring this fact. Currently at the upper end of this accumulation range. LTC +1. Traditionally, it stands to reason that the length of an accumulation range is proportionally related to the amount of capital wanting in at favorable prices. 3/ pic.twitter.com/HClsjHcGJg
— Awe & Wonder 🌑 (@Awe_andWonder) May 3, 2019
In another tweet, he notes that Bitcoin’s exponential trend model, similar to the logarithmic regression, is currently showing that there is “downside risk to still be considered,” as, in previous cycles, BTC fell even more dramatically underperformed the aforementioned model. And lastly, he notes that price-based metrics are “signaling caution.”
Even if Awe & Wonder’s statistics aren’t sound, BTC remains clearly under long-term resistance, as noted by trader Panama Crypto. He explains that Bitcoin’s medium-term and long-term charts both show “mighty resistance” at and above $6,400, adding that he expects for the asset to trade between $5,400 and $6,400 for the time being then.