Bitcoin seems set for a new bottom based on its recent price performance. A new bottom level for the top-ranked cryptocurrency may signal renewed interest from bulls, leading to another significant price rally.
Bitcoin Bottom and Subsequent Price Rally
According to Bloomberg, BTC appears likely to test another bottom level. Referring to a pricing chart, BTC is currently forming a buying divergence. This means that Bitcoin is holding firmly above trend and price lines. Such a situation is typically an indication of an imminent bull run.
However, before this predicted price surge, BTC may test a new low around the $6,000 mark. Since dropping to $6,000 for the first time in 2018 back in February, the top-ranked cryptocurrency has tested that level four other times. On all such occasions, there has been a significant response in the form of an upward price movement.
Bitcoin last tested $6,000 in mid-August 2018 as the cryptocurrency market lost $43 billion over a five-day period. However, the price rallied by more than 20 percent to $7,300 at the start of September 2018.
Experts Predicting Repeated Short Squeezes Before End of Year Rally
Recently, billionaire BTC bull Mike Novogratz predicted that Bitcoin would most likely grind back to previous highs rather than a straight bounce. The Galaxy Digital Management chief declared that the virtual currency had bottomed out and would begin to experience gains.
Arthur Hayes of Bitmex said during a mid-year price surge that the cryptocurrency was experiencing a short squeeze. He also identified $5,000 as the likely BTC price bottom which must be tested before any significant surge can occur. The Bitmex boss believes that BTC could reach $50,000 by the end of the year.
Recent Bitcoin Price Performance
BTC has floated between $6,000 and $7,000 for most of Q3 2018. Once in early July, the price fell below $6,000, bottoming out at $5,800 before staging a spike to $8,300 in late July. This rally culminated in its highest price so far in Q3.
The refusal of the United States SEC to approve a BTC ETF appears to have caused some stagnation. However, there have been some positive developments on the institutional and custodial services front.
Presently, BTC has declined by 2.5 percent in the last 24 hours.
Do you think a new Bitcoin bottom will signal another significant price rally? Let us know your thoughts in the comment section below.
Images courtesy of Bloomberg, Shutterstock, and Coinmarketcap.com.