It looks as though Bitcoin is set to continue its run of bad luck throughout 2018, with an analysis suggesting it’s on its strongest negative trend since the sell-off this year.
Bitcoin to Test 2018 Low?
At the end of 2017, Bitcoin was within touching distance of $20,000. Fast forward to June and the cryptocurrency has dropped in value by nearly 70 percent. At the time of publishing, it’s trading at $6,168, according to CoinMarketCap.
Q1 proved to be the worst first quarter for Bitcoin, and its second-worst quarter in its history when it fell to around $6,200 in February. In May, there was optimism again with Bitcoin flirting with the $10,000 level. Unfortunately, that milestone wasn’t reached, with the currency continuing to slip in value in recent weeks.
Now, though, it looks as though the rest of 2018 could remain a bad one for Bitcoin. According to the Directional Movement Index, Bitcoin is on its strongest negative trend since the sell-off earlier this year, reports Bloomberg. At present, the index’s ADX line is at 39.3. Anything above 25 is deemed a strong trend.
Additionally, the DVAN trend line on the index, which measures buying or selling pressure, is painting a dark picture. The report goes on to say that with no end in sight to Bitcoin’s selling trend, it could test its 2018 low.
In March, a new index was created designed to let investors know when they should purchase Bitcoin. Created by Tom Lee, managing partner and head of research at Fundstrat Global Advisors, it’s called the misery index.
The report stated that whenever the crypto asset falls below 27, it sees the best 12-month performance. At the time, the index was showing a rating of 18.8.
Similarly, Thomson Reuters revealed its own Bitcoin sentiment gauge in March. Designed to capture market moving sentiment and themes, the aim is to help investors know when to buy. According to Dan Morehead, CEO of Pantera Capital Management, the cryptocurrency is a “screaming buy” right now.
Projected Prices Correct?
It will be interesting to see whether predicted end-of-year prices for the digital currency will hit home.
John McAfee has said he expects the number one cryptocurrency to hit $15,000. A report from Fundstrat pegs that number at $64,000 by the end of 2019. Lee is a bit more conservative and is of the opinion that it will reach $25,000 in 2022.
Whatever figure the digital currency does eventually reach remains to be seen. One thing that can be for certain is that it won’t be a smooth ride getting there.
Where do you think Bitcoin’s price will hit at the end of 2018? Let us know in the comments below.
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