Bitcoin Avoids Bigger Selloff as Price Claws Back Above $10,000
Bitcoin’s price regained the $10,000 handle on Thursday, avoiding a steeper selloff that could have exposed the market to mid-$9,000 levels. Bias remains tilted to the downside after the price made a new lower high on Wednesday.
After sliding below $9,800, the bitcoin price returned above $10,000 in the early part of Thursday’s session. Bitcoin’s average price is currently $10,053.72, down 1.2%, according to CoinMarketCap.
Daily trade volumes have picked up gradually throughout the week. On Thursday, more than $1.1 billion worth of BTC traded hands on verified spot exchanges, according to Bitwise. Binance was the single largest spot market for bitcoin trades at $444.7 million. Kraken overtook Coinbase at second spot, with a daily turnover of $194 million.
For all the talk of bitcoin being too volatile, the price has actually been much more predictable over the past month. Bitcoin’s 30-day volatility index, which tracks how much the asset fluctuates over that period, recently hit three-and-a-half month lows. The 30-day volatility index is currently valued at 3.56%, according to bitvol.info. It peaked near 7% last month.
Despite suffering a big price decline, bitcoin remains by far the most dominant cryptocurrency – a trend that has been intensifying as the year progresses. Bitcoin’s dominance rate is currently hovering just shy of 69%.
Technical Trading Dictates Market Flow
Bitcoin enjoyed a sizable rally after Bakkt confirmed the launch date of its new cryptocurrency futures market, but the gains quickly fizzled. As a result, bitcoin has just completed another lower-high, possibly signaling that another price drop was on the way.
According to crypto analyst Josh Rager, a close below $10,200 means bitcoin has broken a short-term trend line.
Have been away from charts mostly this week
Bitcoin possibly just made it's next lower high after rejecting of 20MA on daily and short term trend line breakdown
Currently bouncing off long term trend line and wanting to watch a close above $10,200 pic.twitter.com/PJ2HXJ0ixE
— Josh Rager 📈 (@Josh_Rager) August 21, 2019
Over the past month, bitcoin has failed to overcome major resistance at least four times. The price dumped on each occasion, but the bulls have prevented the market from free-falling below $9,000. The daily relative strength index (RSI) shows a market that is nearing oversold conditions, although we’re not quite there yet.
The daily RSI is currently tracking six-month lows.
Even with the recent declines factored, bitcoin remains one of the top-performing assets of 2019. The cryptocurrency has gained over 165% year-to-date and has more than tripled its December low.
Last week, Josh Rager said he believed bitcoin will reach new yearly highs before the end of 2019. That would cap off an absolutely stellar year for an asset many had written off just 12 months prior.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.