Bitcoin price has been falling over the last few months ever since the first-ever cryptocurrency was rejected at $14,000 this past June.
The severity of the downtrend has picked up over the last several weeks, and may have just come to its climax, if a powerful upsurge in response to today’s low ends up being a legitimate trend reversal.
Bear Trap? Bitcoin Sweeps Lows to $6,450, Rebounds to $6,950 Two Hours Later
Bitcoin price swept local lows today, breaking below $6,500 and touching $6,450 briefly before rebounding higher in a surprise surge.
At roughly 8:15AM EST, the crypto asset set it’s low for the day thus far, and immediately painted a $100 candle in a matter of seconds. Just a few minutes later, the crypto asset had already breached back above $6,700, and eventually exploded all the way to $6,930 before taking a breather to refuel its jets.
The surprise turnaround liquidated late shorters who likely were celebrating too early that Bitcoin had broken through such a critical level and previous low. However, eager bulls front ran the move, pushing the price of Bitcoin higher and higher.
The move could be driven in part by traders looking to snipe Bitcoin’s downtrend bottom, ahead of the upcoming halving.
Sentiment may be at extreme lows, but confident traders have been amassing long positions in advance of today’s plunge, and may have been preparing to buy these lows before Bitcoin begins to rally once again.
The surge was accompanied by a spike in trading volume, and Bitcoin is currently trying to flip resistance at $6,800 to support. Should the crypto asset hold here, and reclaim above $7,000, it could give bulls confidence to cause a full short-term trend reversal, and send Bitcoin back into an uptrend.
The trading ranges left above current levels will act as resistance on the way back up, but Bitcoin’s halving could be enough to drive the price of the leading cryptocurrency by market cap to a new all-time high if this potential reversal holds.