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Bitcoin is becoming negative again. And the technical details are not going too well in 2019.
The largest cryptocurrency sold 5.9 percent to $ 3,668.09 on Wednesday, approaching a record high of $ 3,522.58 on November 26th. After some days of relative stability, volatility increased again following the November crash, which was the biggest monthly drop in over seven years.
Bitcoin is characterized by a strong sales trend – the most pronounced since the sell-off suffered half of the year, when the price has plummeted from about $ 9,300 in May to about $ 6,600 in July, according to the Index of the Executive Movement. If this dive is an indicator of how things could happen, then Bitcoin could be on a continuous course.
In addition, the middle managerial index, or ADX, a technical indicator that rises while negative sales trends are strengthening, is at its highest level since July. If it exceeds 50 – currently it is around 47 – it will be the first time that this year will do it in a negative scheme.
Prices for Bitcoin and other cryptocurrencies will weaken, with Bitcoin falling to around $ 1,500, Bloomberg Intelligence analyst Mike McGlone said in a statement Wednesday. This would imply a further 60 percent drop in the price of Bitcoin from the current level. Bitcoin fell 80 percent from the December 2017 record when it hit $ 19.511.
"There is little to prevent the faded bitcoin prices from reaching the continuous average of $ 1,500," wrote McGlone. A rush to exits among investors seems to be taking place, he said, attributing it to the Bitcoin cash division and sales related to year-end tax purposes, among other things.
Cryptocurrencies have seen a massive sell-off in the last month, with the biggest tokens losing billions in market value since Bitcoin Cash bifurcated in November. This happened when two software development factions failed to agree on a way to update the offshoot of the original Bitcoin, leading to an arms race.
"We are at a classic psychological stage where the market is reversing the frenzy of 2017," said McGlone in an interview. "The hard gallows was a key factor that signaled that technology is too nascent." You had these menacing characters threatening to destroy each other and the institutions said "It could be better if we keep away from this for a while." # 39 ;. "
The Securities and Exchange Commission also reduced space cryptography by imposing fines on two companies last month that did not record their first money bids as securities. And the head of the SEC said last week that concern over the lack of investor protection makes it unlikely that the agency will approve a Bitcoin exchange-traded fund at any time, something that the Bitcoin bulls have plagued for the whole time. # 39; year.
Bitcoin fell more than 40 percent in the last month and November marked its biggest monthly decline in over seven years. XRP, the cryptocurrency also known as Ripple, is down nearly 30 percent in the last month.
The lower prices, however, indicate reductions in speculative excesses and help reduce volatility, said McGlone. "But the trend of this year is clearly sustainable – it's a positive trend," he said. "The trend is a reduction in prices, lower volatility, a reduction in speculation and a preponderance of stable currencies," he said, referring to tokens designed to minimize price volatility. Until then, cryptocurrencies must find a basis to see more stability and "we are not yet close to this base".
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