Bitcoin made an attempt to recover after the news that the US state of Ohio would accept the digital currency in 23 different types of business taxes. It’s good news and a common acceptance of the cryptocurrencies, but it was not good enough to see a sharp twist yesterday. As a result, Bitcoin closed near the bottom but earlier this morning attempted to recover more than $ 4,000.
It’s hard to see any recovery unless the whales start to accumulate, as some speculate. According to the theory, the whales that have accumulated Bitcoin outside the exchanges place it on the market to trigger a wider sale and lower prices. And once prices have fallen sharply, they will accumulate a bit more and eventually raise prices.
Bitcoin dropped by 40% on the recent collapse and by about 80% from the peak in December 2017. Currently, the cryptocurrency is traded at its lowest levels since September 2017. The largest digital coin fell four months in a row. November is about to end, and there is little doubt that his candle will also be coloured in red. This is the longest series of declines since early 2014, although the scale of collapse is far more impressive now.
If the whales do not start to accumulate again, BTC/USD can quickly resume its decline.
Now I want to pay special attention to the recent behaviour of BTC/USD. The candles on the daily chart clearly show that the fall below $ 6,000 occurred on Wednesday, November 14th. The collapse under $ 5,000 occurred on November 19th. And the latest fall (so far) under 4,000 took place on November 24th. As you can see, breakthroughs below the round psychological levels occur every 5 days. Five days of 24th is 29th November, which is tomorrow. And the next whole level is $ 3,000.
There really is no guarantee that this theory of conspiracy will happen, but I think we should pay attention to similar patterns of behaviour on the market. If the theory of dumping is correct, whales may hit again on Thursday and bring the price below $ 3,000. I think we will soon know.
In the short term, however, BTC/USD has a chance to expand its upward recovery. The price is traded above the SMA50 at $ 3,894 and the SMA100 at $ 3,989 on the hourly chart giving bullish signals. In addition, both RSI and Momentum indicators point up, which increases the chance of recovery. While the price stays above these levels, we should see an increase in the bullish momentum for testing the SMA200 in the $ 4,271 region.
On the downside, 50- and 10-day SMAs should serve as the closest levels of support. If BTC/USD breaks out clearly under $ 3,894 support, the bears may take the control again and restest the bottom price on Tuesday on $ 3,655.
Author: Silviya Velcheva
* The views expressed in this material do not constitute a recommendation or advice for the purchase or sale of cryptocurrencies in the digital assets market or other financial instruments. The predicted forecasts meet the expectations of the author of the material and may not materialize. Trading in currencies, contracts for differences on margin or cryptocurrencies poses a high risk and may not be suitable for all investors. Past results are not a guarantee of future success.