The cryptocurrency market witnessed a sudden crash in prices last week. Many investors were afraid that an upcoming crash is yet to happen. Even Bill Gates went to the mainstream media and said that he believes the cryptocurrency market will eventually collapse, and even bet on it. In reality, this is far from happening. Prices fell due to a massive previous price increase, and a simple adjustment was bound to happen. In this article, we’re going to analyze the Bitcoin price and explain why prices are far from a collapse.
What Happened to Bitcoin?
Bitcoin prices were going on a steady uptrend. After an extended price increase, prices fell sharply on the 18th of April 2021 (fig.1). Everyone started to panic, signaling chaos and making up dumping stories. In fact, prices fell at a max of 14% from a price of USD 60,000 to USD 51,500. This price adjustment quickly adjusted back and prices went back to an important price area of USD 54,500.
Looking back at how Bitcoin’s price-action acts, we can clearly see that the current price of USD 54,600 sits around an important price area. Not only did Bitcoin’s price return back to this area, but it previously marked this territory more than 6 times in the past month (fig.2). This is a clear indicator that prices are surely consolidating again around this level, before they go back up towards the psychological price of USD 60,000.
The importance of Zooming Out
When we first hear the news, all we read about is how the cryptocurrency market was deep in the red, and how this industry might collapse. Let’s focus on two words that were the talk of the media: Collapse and Crash. Now, let’s look again at Bitcoin’s price chart, not from last year’s prices to be fair, but only since the start of the year:
Now, repeat after me: I will NEVER listen to the mainstream media, I will do my own proper analysis and I will follow CryptoTicker on Twitter.
Seriously now, how can anyone claim that the last price adjustment is the absolute collapse of cryptocurrencies? In fact, Bitcoin prices retraced EXACTLY back to the average uptrend that started since the beginning of 2021. Now we’re not saying that a further price adjustment is never to happen. Prices can still reach USD 48,000 which presented a previous strong support, but calling out a crash from figure 3 is insane. That’s why it’s always important to zoom out and understand the whole picture.
The whole Crypto Market
In the past 7 days, most cryptos lost in their prices due to this previous price adjustment. Ether on the other hand managed to not only quickly, but break its ATH and reach a current price of USD 2,615. Additionally, a new contender entered the Top 10, which is Dogecoin. Woof Woof, that’s welcome in Doge language 😉
1- Bitcoin (BTC) : – 12.92 %
2- Ether (ETH) : + 6.14 %
3- Binance Coin (BNB): + 5.11 %
4- Ripple (XRP) : – 22.11 %
5- Tether (USDT) : 0 %
6- Cardano (ADA) : – 15.81 %
7- Dogecoin (DOGE) : + 120.61 % (New to the Top 10 List)
8- Polkadot (DOT) : – 16.97 %
9- Uniswap (UNI) : – 4.10 %
10- Litecoin (LTC): + 3.63 %
Stay Ahead, Stay Updated
You might also like
More from Bitcoin
There's good news on the Bitcoin ETF front. Bloomberg reported on Oct 15 that Securities and Exchange Commission (SEC) granted …