How Low Can Bitcoin Go?
It’s clear by now that the entire crypto market is in a massive retracement.
It started with a bit of profit taking but it seems that the FUD is now gripping the market. Comments from enthusiasts like Charlie Lee probably didn’t help either.
Those who have been in this market for a while are not nervous though. We’ve seen this type of action many times before. In fact, the traders out there have been expecting it.
You don’t get quadruple-digit gains without a few double-digit pullbacks. For the true believers, this is the time to consider buying the dip.
eToro, Senior Market Analyst
- Catalonia Mess Continued
- Goldman’s Crypto-desk
- Bitcoin Dip Charts
Please note: All data, figures & graphs are valid as of December 22nd. All trading carries risk. Only risk capital you’re prepared to lose.
Now that tax cuts are out of the way. Congress was able to move on to the next most urgent order of business, keeping the government open.
Last night they passed a quick fix that will allow Congress to pay their bills over the holidays. This three-week patch is a clear case of “kicking the can down the road.” Still, it’s much better than the alternative.
So we can expect that the first issue of the US government in 2018 will be a more permanent budget solution.
Also in the news this morning are the results from the elections in Catalonia. To the dismay of Mariano Rajoy, the three separatist parties have taken an outstanding 70 seats of the 135 seat electorate and can easily build an anti-Spanish coalition.
The Spanish Esp35 index has opened now with a significant gap down.
Long Blockchain P&D
It’s no doubt that everybody is going crazy for crypto. Investopedia has called “bitcoin” the term of the year. Yesterday a company that has nothing to do with digital assets rebranded themselves to see an exponential growth in their stock price.
Here’s a graph of a company formerly known as Long Island Iced Tea, that has recently changed their name to “Long Blockchain.”
Ladies and Gentleman this is Wall Street’s version of a pump and dump. Traders realize that the rebranding is only a publicity stunt and the company has admitted that they may never even integrate any blockchain solutions.
Now, the infamous trading firm Goldman Sachs is getting in on the action and has announced that they are opening their own Cryptotrading desk.
This is a truly exciting update and it only confirms what we’ve been saying at eToro for the past few years, that cryptotrading is the future of Forex.
With that, as every trader knows, markets go both ways and at the moment they’re going down. So let’s take a look.
Looking at the overall cryptomarket, we’re now 25% from the top. Timewise we’re back to the levels last seen on December 13th. All in all, not too much damage so far but the fear is certainly setting in with many and there is a possibility to go further.
For bitcoin, this is the chart that I’m looking at this morning….
According to the chart, even if we see a move to as low as $10,000 we could still consider bitcoin to be in a strong upward trend. In fact, $10,000 was exactly the level that bitcoin was trading at the beginning of this month and so it would not be surprising to see it there again.
Is it Santa’s Fault?
Several have mentioned this morning that this pullback is being caused by people who want to buy Christmas Presents.
At first, I thought that the notion was ridiculous. After all, most crypto volumes happen in East Asia where Christmas isn’t really as much of a thing. However, after checking the recent volumes, there may be something to this theory after all.
According to coinmarketcap, combined volumes from bitflyer and bithumb, the two largest exchanges in Japan and South Korea, the two biggest crypto countries in the world, only account for a combined 5% of crypto volumes today.
Cryptocompare also has a nifty graph that seems to indicate the West taking up a larger portion of the market in the last 28 hours.
No matter what’s causing the pullback or how much longer it might last. I would like to wish everyone an amazing weekend ahead and a very Merry Christmas.
This content is provided for information and educational purposes only and should not be considered to be investment advice or recommendation. The outlook presented is a personal opinion of the analyst and does not represent an official position of eToro. Past performance is not an indication of future results. All trading involves risk; only risk capital you are prepared to lose. Cryptocurrencies can widely fluctuate in prices and are not appropriate for all investors. Trading cryptocurrencies is not supervised by any EU regulatory framework.