Did we find the bottom of Bitcoin Price?
Technical analysis data that could indicate a trend change in cryptocurrency. Why buying 'cheap' won't make us profit.
The rise of Bitcoin has continued in recent days. From the low of $ 6,850 on January 3, it has climbed 17% so far. The reason, as we explained in more detail, was the tension created between the US and Iran.
Looking at the chart, we see for the first time in months the downward trend showing signs of a reversal. Recognizing a trend is a relatively easy task. There is no need for years of experience, sophisticated technical analysis programs and complex computing systems. If the next peak is formed at a higher value than the previous one, it means that the voltage starts and rises. On the contrary, it defines the beginning of a downward trend.
The blue and orange arrows in our 4-hour chart show just that: the top is higher than the previous one. At the same time, the bottom is also higher than the previous one. There is now evidence, not just evidence, that the pressure of sellers is not as strong as before. So the chances turned in favor of the climb.
Technical analysis is a misunderstood method. It is a diagnostic tool, not a forecast. It is, in essence, an attempt to decipher, so that we respond to market events as they unfold and not as we would like them to.
Our opinion does not matter. It doesn't matter what you or I think or at what price everyone bought. The market is indifferent to our opinion. For what we consider a fair valuation. A successful investor stands out when he dismisses the selfishness of his opinion and trusts the facts. The fact that after a long time we see higher peaks and bottoms is not an opinion. It is a fact.
In a market as large as crypto, there is no chance of launching any significant movement that does not exceed the previous peak. When are we entitled to be optimistic? Until we see the upside. The newest peak lower than the previous one.
The bottom is not as fit as you are. Some are lucky enough to confuse it with skill. But lucky you can't be a continuation. If the stock market has taught us something, it's better to buy more expensive upward rather than downward cheaper. That is why it is easier and safer to see voltage reversals first. Buying "cheap" won't make us profit. The important thing is to sell more expensive than the price we bought.
We had a similar reaction to gold, as we can see in the corresponding diagram. The rise there had begun earlier. As if they knew something was going to happen. Reasonable. Next to President Trump is the banking lobby, not the "bitcoiners."
It may sound outrageous to compare gold, a time-honored value accepted by everyone, with Bitcoin having just closed 11 years of existence, and the vast majority of the world ignoring it. However, many believe it well or wrong, because the value of both gold and Bitcoin is determined in the same way. With the offer fixed, the price goes up as the number of interested parties fluctuates.
When we say that Bitcoin has just closed for 11 years, we are literally. A few days ago, Bitcoin had its birthday. The diary was written January 3, 2009, when the first block containing the first 50 Bitcoin was created (extracted) and a message: The Times of London cover page, which said it would need a second bailout package for banks. It was the period when the bursting of the mortgage bubble had led to an unprecedented financial crisis. An incredible number of billions had to be spent to ensure the viability of the banking system.
Since its appearance, the scenarios for how Bitcoin will die are abundant. Governments will ban it, hackers will dominate it and more. So far they have been solemnly denied. You can hardly call this a failure. You are sure to find several dictionaries that have a different viewpoint. Here is the well-known cliché "what doesn't kill me makes me stronger".
In the last decade, Bitcoin has spread from a handful of cypherpunks to a population of approximately 1% of the world. Bitcoin has ceased to be the currency of the illegal, marginal, dark web. It's on Wall Street. The central banks, from where they snoozed it, are now trying to imitate it. The virus is spreading. Conditions are more favorable than ever.