Bitcoin (BTC) is currently trading at just above $8,440 following a 3% drop in price since last Monday.
Additionally, BTC has also managed to drop below its 200-day EMA – not a great sign for the bulls.
Bitcoin has been consolidating since last month after price spiked from $7,500 to over $10,000, before retracing to the $9,000 range.
Will BTC recover back to $10,000 and above soon?
Let’s take a look at Bitcoin’s chart.
At the time of writing, Bitcoin has been making a number of lower highs.
Since the massive bull market that took Bitcoin close to $14,000 earlier in the year, the coin has been dropping in value following a downtrend that was only broken in late October when price broke through a number of key resistance levels (around the 200-day, 50-day, and 20-day EMAs).
Following the late-October pump, where the price of BTC rose over 40% in the space of 24 hours, it seems the market has now stabilised.
Last week, I said I expected BTC to find a bottom near its 200-day EMA and that Bitcoin would bounce to around $10,000 soon. It has instead broken below its 200-day EMA, but crucially BTC has managed to stabilise since then and minimise any losses.
The current Bitcoin trend
History shows us that BTC is prone to huge drops between 30% and 40% during bull seasons. Therefore, I don’t advise that you fight the trend, but surf it for as long as possible.
Last week, I underlined that within the next three to five weeks, we could see a major reversal after a period of serious accumulation by ‘hodlers’.
However, for the time being, not only has Bitcoin reversed its downwards trend, I argue BTC will reach $12,000 by the end of 2019 if we continue to see strong gains.
Volume, which had dropped from a peak of $27 billion earlier in the year to just over $15 billion last month, is now back to the $20 billion range. At the time of writing, it is about $21 billion. The volume profile also shows that BTC is near a key support level close to $8,100.