For months now, crypto investors have been asking if the Bitcoin (BTC) bottom is in. While the answer has mostly been no over the past few months, a number of analysts are becoming certain that the drop to $6,400 seen earlier this month was the final bout of decisively bearish price action this cycle.
Related Reading: How Rakuten’s Latest Bitcoin Effort Could Help the Markets
Did the Bitcoin Form At $6,400?
Cryptocurrency trader TraderXO recently remarked that Bitcoin’s price action over the past few weeks is eerily resemblant of a textbook scenario laid out by legendary chartist Richard Wyckoff, who studied trends in markets.
XO suggested that BTC’s chart is currently shaping up to be the mirror image of an “Accumulation Schematic” depicted by Wyckoff. When applied to Bitcoin’s chart, the schematic suggests Bitcoin will rally to $8,000 by early next year, then crash to enter the high-$6,000s yet again, then break out past $8,000, then $9,000 by March of next year.
$BTC – Wyckoff like scenario – just throwing this out there…
Very early to determine whether this is at all accumulation – it can easily breakdown on a retest of the lows again.
Volume profile switched off – you can reference that yourself
Will keep this thread updated pic.twitter.com/u9qW0txpIC
— TraderXO (@TraderX0X0) December 23, 2019
Bull Signs Appear On the Charts
It isn’t only TraderXO’s Wyckoff analysis that suggests that a bottom has formed on the Bitcoin charts and bulls are poised to take over.
Per previous reports from NewsBTC, cryptocurrency trader Galaxy recently pointed out that Bitcoin’s one-day chart has printed a key bullish signal: an indicator tracking the asset’s momentum has just printed a “buy” signal on December 22nd.
Guess what comes next.
I can give you a hit.
— Galaxy (@galaxyBTC) December 23, 2019
Although some may question the validity of this momentum indicator, the last time a “buy” was printed prior to this latest signal was in mid-February, when BTC was bottoming in the low-$3,000s and over a month prior to Bitcoin breaking out from $4,000 to $5,000.
Related Reading: Why Ethereum Could Rally by Over 100% Against Bitcoin: Analyst
That’s far from the end of it.
Prominent trader “SmokeyXBT” recently posted the chart below on Twitter, remarking that if $6,400 “was the generational Bitcoin bottom, it was the most perfect bottom to ever be formed.”
Indeed, the chart he attached to this message shows that BTC bounced off a macro established support of the 2018 bear market, which coincided with the lower bound of a six-month-long descending channel.
Featured Image from Shutterstock