Bitcoin has been rallying between the $3,600 to $4,000 mark and finding it difficult to break the upper resistance level of $4,200. 2018 has been dominated by bearish trends causing the market to bleed out 90% of its total market capitalization. Now, that the holiday seasons have begun, the trading volume has decreased even further, making the market even more volatile and unpredictable.
Mark Dow, a former IMF economist has said that, in order to gain some stability and wander off the uncertainty, bulls must take the price of Bitcoin above $5,000 mark. The former economist made his views public through his Twitter account, which said,
“Still a beautiful chart. If bitcoin can’t bounce to at least 5k-6k soon, it’s a really bad sign for the cyber-bulls. And if it breaks down thru the yellow line at any point, even the HODLers need to GTFO,”
The ‘Yellow line in the Sand’ is created via weekly Simple Moving Average(SMA) 200 which is currently at $3,160.
The Current Bitcoin Scenario
If we look at the 4-hour chart, Bitcoin has slipped under the SMA 100 mark, which is not a great sign for short-term bulls. If the sell-off does not slow down, Bitcoin might touch its last month low of $3,300. Currently, the lower resistance level is at $3,500.
However, if the market gains some upward momentum, then the prices might recover above 3,750 and bring the Bitcoin above SMA200 (4-hour chart). Bitcoin can then look towards making into SMA50 (4-hour chart) and try to break the upper threshold of $3,850.
The current selling trends coupled with Flat RSI bodes which may suggest that the selling is going to increase even further.
Crypto enthusiasts and investors had to bear the brunt of the volatile market, which took an indecisive turn after the infamous BCH network Hard fork. The market has been bleeding since, and even a few bullish trends in between could not take the prices anywhere near to what many might have predicted at the same time last year.
Many crypto analysts have shown solidarity in hope of a stable first quarter of 2019, however, the current trends suggest otherwise. The volatility of the market can only be reduced, if the Bitcoin and other altcoins manage to find wider acceptance and daily use, as Satoshi envisioned in his white paper, then only we can expect the markets to stabilize.