Why do traders expect Bitcoin price to drop to $ 5,300?




Bitcoin halving by 2020 will not have an impact on prices as expected


The Fibonacci retracement level is showing $ 5,300 which is an important short-term trend for Bitcoin. Given the tendency to retest key Fibonacci levels, this could indicate that BTC is more likely to witness another round of price declines.


Since April 7, the price of Bitcoin has dropped from $ 7,325 to below $ 6,600 - equivalent to a 10% reduction. The king has rebounded to $ 7,150, when traders anticipated a slight rally to the day before BTC closed the weekly candle on April 12. However, BTC was strongly denied and slipped back below $ 6,600 when the weekly candle just opened.


Why $ 5,300 is so important to Bitcoin in the short term


When using the Fibonacci retracement indicator, technical analysts will consider 23.6%, 38.2%, 61.8% and 78.6% as the most important short-term levels. For example, if the price of an asset drops by 23.6%, that would leave it at Fibonacci 0.236.


Technical analysts often consider the Fibonacci 0.618 level to be the most important short-term support. Also known as the "Golden Ratio of 0.618", this level is also used in other mathematical applications such as galaxy formation and architecture.


According to a cryptocurrency trader named Crypto Birb - who shared the chart that defines the $ 5,300 level as Fib 0.618 for Bitcoin in the near future, BTC may retest the lows of $ 5,000 before a rally. other prices.


4-hour chart of BTC / USD with a Fibonacci level of 0.618. Source: Crypto Birb
4-hour chart of BTC / USD with a Fibonacci level of 0.618. Source: Crypto Birb

Historical data shows that Bitcoin tends to large Fibonacci levels many times over a short period of time. Such a return occurs because BTC is an emerging asset, often with extreme fluctuations.


When Bitcoin recorded a significant price drop, such as the collapse to $ 3,600 on March 12, it often tended to react to the V-shaped recovery. more severe losses for BTC by a large pullback, increasing the risk of retesting important area levels such as the 0.618 Fibonacci level.


The 1-week chart of BTC / USD shows that the test has been repeated many times at 0.618 since 2018. Source: Tradingview
The 1-week chart of BTC / USD shows that the test has been repeated many times at 0.618 since 2018. Source: Tradingview

Short-term adjustment scenario


Bitcoin price was strongly rejected at $ 7,150 on April 13, and analysts predicted two possible scenarios for BTC in the near future.


The price of BTC can rise to the range of $ 7,300 to $ 7,700, reject the so-called "distribution point" and move towards lower support levels.


The bullish scenario is when BTC gains $ 7,300 as support, thereby consolidating around this level and witness a rally to $ 7,900 next week.


4-hour chart of BTC / USD with up and down scenarios. Source: CJ Twitter
4-hour chart of BTC / USD with up and down scenarios. Source: CJ Twitter

Bitcoin's recent rally has been supported by spike in volume, while previous rallies still lacked volume to push it to strong resistance levels.


However, in the short term, traders are still very confident that $ 3,600 is the bottom of 2020. The price could consolidate in the range of $ 4,000 to $ 5,000, but is unlikely to return to the mid-level level of 3,000 again.


Famous cryptocurrency trader Loma said:



“Not sure how much momentum we have left here, but the $ 7,700 area is currently in sight. This type of PA makes me pretty confident that prices have bottomed out this year. ”



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According to CoinTelegraph
Translated by ToiYeuBitcoin




About My name is Nguyen Manh Cuong. I was born in a poor village in Ba Vi district, HA NOI province - windy and sunny land. Currently. https://www.nguyendiep.com/. Mr Cuong.
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