Bitcoin suffered another decline today, falling through $7,000 and approaching $6,800.
The digital currency reached as little as $6,828.48 today, its lowest since late November, CoinDesk figures show.
At this point, the cryptocurrency was down more than 50% from its 2019 high of $13,879.21 reached in June, additional CoinDesk data reveals.
Bitcoin has been following a steady, downward trend for months, during which it has been “trading in a descending channel,” noted Tim Enneking, managing director of Digital Capital Management.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
After its latest declines, has the world’s most prominent digital currency entered oversold territory?
When will the cryptocurrency bottom out?
Several analysts offered their points of view.
“Looking at RSI metrics, I would not say we triggered an oversold situation,” said John Todaro, director of digital currency research for TradeBlock, referring to the Relative Strength Index, an indicator used to determine whether an asset is either overbought or oversold.
Joe DiPasquale, CEO of cryptocurrency hedge fund manager BitBull Capital, offered a similar perspective, stating that “bitcoin is currently approaching the oversold threshold.”
Has Bitcoin Bottomed Out?
As for whether the digital currency has hit bottom, multiple analysts indicated it has not.
“It’s quite clear that BTC has not put in a bottom yet,” said Enneking.
“The price has been in a descending corridor since the crazy 42% increase in late October,” he stated.
“The prior low, around $6.6k, is almost certainly not going to hold (i.e., no double bottom) as the market is very weak in terms of recovery from that level and volume.”
DiPasquale offered a similar point of view, stating that bitcoin prices could very easily push lower in the near future.
“At the moment it is being held up by a very weak support, around $6,800, which was briefly tested the last time on May 12 and 13, 2019,” he said.
“Downward pressure continues to mount as both, the 150-day and 50-day moving averages have declined, from $9,500 and $8,360, on December 1, to $9,125 and $8,069 today,” said DiPasquale.
As for specific predictions, Todaro said he “would expect the selling to bottom soon.”
Enneking also chimed in, stating that “the highest likely bottom will be much closer to $6k or just below.”
“A dramatic spike down and recovery (à la ETH in December of last year) would be a clear indicator of a bottom, but we simply haven’t seen anything close to that yet.”
Author: Charles Bovaird
Source: Forbes: Is Bitcoin Oversold After Its Latest Drop?