Bitcoin

Analyst Says Bitcoin May Drop to $5,500 Before New Upside In Q3/Q4 2018

Ricardo Esteves | May 26, 2018 | 11:39 am
Bitcoin

Analyst Says Bitcoin May Drop to $5,500 Before New Upside In Q3/Q4 2018

Ricardo Esteves | May 26, 2018 | 11:39 am

The price of Bitcoin has faced unexpected downward pressure in May as Consensus 2018 did not produce enough enthusiasm for a bullish move. Analyst Willy Woo said the virtual currency may only find its upside in Q3/Q4 2018. Until then, bulls may find bid opportunities at prices as low as $5,500.

Bitcoin to Complete Downside At $5,500-$5,700, Analyst Says

The cryptocurrency market has been under pressure in 2018 following an extensive race to the top, with Bitcoin breaching the $20,000 level. Traders were expecting the Blockchain Week in New York to trigger a new bullish momentum, but the market lost $52 billion after a disappointing event.

Bitcoin stalled below the $10,000 area in early May and has been steadily returning to the 2018 lows. Willy Woo, a BTC technical analyst with 62,500 followers on Twitter, is not very optimistic about where the market is moving next. Woo expects the market to give in to bears for a downswing towards $5500-$5700.

“NVT Signal is still too high. We need more blockchain transactional activity to justify the current price, or the price to drop to reconcile the difference. To drive up transactional activity in a bear slide is very unlikely IMO”, Woo said, also referring to the extreme market moves. “Volatility is still too high. I’m looking for a sustained low band of volatility which tends to be a signal for the end of the detox and the next accumulation phase. It’s still got some time to ride down.”

The BTC analyst argues that his $5500-$5700 prediction is further supported by a high Standard NVT and a Volume Profile cliff below $6800.

“When I run the above scenarios against detoxing at a $6800-$7000 floor, it seems a very unlikely path we’ll play out at the $7000 level. This is given the time we need for NVT and volatility to baseline. (…) I don’t necessarily think we’ll fall through the 5000s… sure it’s a possibility but it doesn’t have to. It’s not a repeat, it’s not Mt Gox and Willybot pushing up price with faked orders, we aren’t detoxing from a scam bubble. Technically $5000s is a very strong support band.”

The cryptocurrency market in 2018 is more mature compared to 2014 as there no longer “a few whales randomly pushing things around anymore”, which provides a more reliable understanding of price based on fundamentals. Woo says that BTC is not a market on long time frames. Instead, it is an adoption curve (climb, consolidation, climb, consolidation).

The analyst expects Bitcoin to steadily drop to $6,800 before plunging to $5700, which should be followed by a leveling out of the drop and a flat zone. The next bullish momentum should come in Q3/Q4 2018, according to Woo.

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  • michaelpalmeter

    Utter nonsense. TA is complete bunk, an appealing but absurd pseudoscience.

  • Jim Kelly

    TA has predicted the top in stocks as well as the top in Bitcoin. Bravo to TA. It will save your skin. Human behavior to blow off tops is always predictable. More downside to come.

  • David

    if bitcoin wont pick up from 7k and slide down 5k its all over , the bear wins the bull

    • spooky shadow hawk

      Consider it a Time of Options for those who design Block Chain Programs, all the recent hacking show’s a need for a different approach to Block Chain Security. Link Block Chain to a Artificial intelligence that is passive on normal transactions, but if hash power reach’s 45% in shuts down the transaction, records address and alerts all exchange’s linked to the service. As this security is vital to the growth and protection of the Exchanges, they should put up the money for the AI to encourage the development of a much needed Security Tech service for all the Block Chains. The amounts of money being stolen as exchange after Exchange is overpowered will only increase unless something like this is done. This lack of security undermines the Exchanges, the block Chains and the Crypto Currencies. For those with the technical abilities, this is a rare opportunity. As long as the theft’s continue, confidence and credibility is lacking. This affects growth of the market. Exchange’s should consider it as a Investment in Tomorrow.

  • Jared Odulio

    no bullish sentiment in sight yet, we’re looking at 6759 next week

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