Bull Not Done Yet: Bitcoin Price Shows Strength as BTC Rallies to $8,400
On Monday, Bitcoin (BTC) finally started to show some strength after the massive decline seen the week prior.
As of the time of writing this piece, the cryptocurrency is at $8,400, having rallied by nearly 8% from the $7,700 low seen late into the weekend. Altcoins, too, also have started to flex their muscles, with both Ethereum and XRP gaining 6% in the past 24 hours.
According to a number of analyses, this recent bounce in the Bitcoin price is likely a precursor for a further recovery, which will reassure the cryptocurrency market after the tepid launch of Bakkt and a mass evaporation of positive sentiment.
Bitcoin Price Ready to Head Higher
Macro investor and gold proponent Dan Tapiero recently noted that the Bitcoin price chart has printed a massive bull signal.
In a tweet, the institutional investor noted that the TD Sequential indicator, which is a time-based technical indicator, has drawn a buy 9 signal. Tapiero noted that the last time that this buy signal was seen was in January 2019, when the cryptocurrency traded at $3,600.
What followed, of course, was a massive move to $14,000 over the course of the following months.
Bitcoin might put in a perfected TD 9 buy signal today. Last time I pointed out it disappeared on close. (Thanks to @TommyThornton for catching.) Very important to watch 5pm "close" to confirm. Rare buy signal last at 3600 Jan'19 came right before large multi-month 400% rally. pic.twitter.com/iBVKR3bkR9
— Dan Tapiero (@DTAPCAP) September 30, 2019
Also, Luke Martin has argued that the recent close of the monthly CME futures contract may mean that upside for BTC is about the materialize:
“Expecting upside on $BTC towards 9k. Wrong below 7800. Partially based on the chart and partially based on the data set below,” he explained as he pointed to a tweet that shows the historical gains BTC incurs after the expiry of a CME future.
The fundamentals seem to support a price recovery as well. Speaking to The Independent in the week of last week’s price decline, eToro analyst Simon Peters remarked that with Bitcoin’s hash rate still strong, “and adoption of crypto still moving forward at pace, we could see the price rise back up to $10,000 within the space of the next month.”
BitBull Capital CEO Joe DiPasquale has echoed this, arguing that since the fundamentals of the Bitcoin network “remain strong”, a move higher, potentially back to five digits, could take place in the “coming days”.
Bitcoin Bull Not Done Yet
Even if Bitcoin doesn’t soon return higher as the above mentioned investors expect, many analysts believe it may be shortsighted to flip bearish.
Blockroots co-founder Josh Rager recently reminded investors that in previous macro bull trends, Bitcoin has drawn down massively to only establish record price highs months later.
The prominent analyst specifically made reference to 2013’s bull market, during which BTC “pulled back 75% over 89 days” prior to a 1,600% run-up later in that same year.
What Rager is arguing is that Bitcoin’s current downtrend does not put BTC decidedly out of bull territory, and that investors can expect the uptrend to resume in the coming months.
But doesn’t the price drawdown from $14,000 to $7,700 — a loss of nearly 50% — seem dramatic? You might be wondering.
Sure, but it’s really par for the course in Bitcoin standards.
ARK Invest’s in-house crypto analyst, Yassine Elmandjra, noted that BTC is currently at “similar levels of recovery as both 2011-2013 and 2015-2017 recovery periods”. Indeed, as Elmandjra’s below chart shows, Bitcoin has recovered to around 40% of its all-time high in 284 days from the bottom, which is marginally better than what BTC accomplished during two previous cycles.
UPDATE:
Bitcoin recovery period is setting record paces.
Day 187 into the recovery process.
Price now at ~55% of its all time high.
The last time Bitcoin was down > 80%, it took 3x as long to get to where it is today. pic.twitter.com/KvUxtCIF5i
— Yassine Elmandjra (@yassineARK) June 22, 2019
This implies that the cryptocurrency market is still on track to embark on another long-term bull run, despite what cynics have been spouting on Twitter.
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