Bitcoin Correction Targets Sub-$9K Levels
Bitcoin’s price resumed its long unwind from 17-month highs Wednesday, falling to the low $9,000 region and threatening to break below that critical threshold.
The bitcoin price declined by as much as 3.9% on Bitstamp, reaching a low of $9,049.54. The BTC/USD exchange rate was last seen hovering just north of $9,492, where it was up 0.9%.
The 24-hour trading cycle tells a completely different story, with bitcoin falling nearly 12% over that span.
Bitcoin is down 29% from its most recent high of $13,200. The price has corrected 32% from the June swing high near $13,900.
Even with the latest slide, bitcoin’s price has more than tripled from the December low and is currently riding a five-month winning streak. Based on the current trajectory, it will be hard-pressed to translate July into another winning month.
Bitcoin’s latest correction was accompanied by a sharp rise in trading volume. Bitwise’s ‘real 10’ trading volume index shows daily turnover of $3.1 billion. Binance was the single biggest spot exchange for bitcoin trades at nearly $1.2 billion.
At current values, bitcoin has a total market capitalization of $167.1 billion, which accounts for nearly 66% of the overall market. Bitcoin’s dominance rate has been steadily rising for much of 2019 as altcoins and tokens failed to keep pace with its parabolic gains.
Time to Buy?
It was not that long ago that many in the crypto community were wondering if we’d ever see a four-figure bitcoin again. The latest correction, while steep, is nothing new for the digital asset.
Bitcoin underwent several 30% corrections during the last two major bull markets; each one was swiftly absorbed, leading to higher highs that eventually paved the way for a $19,786.06 price point on December 17, 2017.
Bitcoin’s current trajectory matches a recent forecast made by crypto trader Josh Rager, who told his Telegram channel he was “looking to short any rally with … eyes set on low 9ks.” A break below $9,000 would confirm a bearish head and shoulders pattern formation identified by some traders late last week.
— Chonis Trading-⚔️ (@BigChonis) July 13, 2019
At the same time, some notable crypto traders are using this opportunity to increase their holdings. American Hodl just bought $5,500 worth of BTC within the last 24 hours.
It’s unfortunate I had to use shitcoinbase for this, but I’m maxed out on @CashApp a stack is a stack is a stack as my great grand pappy used to say. God damn I feel bullish as fuck. pic.twitter.com/DeFd4ExXvb
— AMERICAN HODL 🔑 (@MericanHodl) July 16, 2019
I feel no fear during the bull, only greed. Pure unadulterated greed. Greed is good. Greed is right, greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed, in all of its forms; has marked the upward surge of mankind. #stacksats pic.twitter.com/7jc97bXcCx
— AMERICAN HODL 🔑 (@MericanHodl) July 17, 2019
Taking a macro perspective, bitcoin’s price is likely to continue higher in the near future. If history is any indication, it will continue to rally long after the May 2020 halving event, which basically cuts the supply of new BTC in half. The largest cryptocurrency remains in a prolonged accumulation phase that is benefiting from a steady influx of new capital in the form of institutional investors.
Relevant reading: Five Reasons Why Bitcoin Is Surging.
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.
Featured image courtesy of Shutterstock. Chart via TradingView.