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Bitcoin is feeling the pull of gravity in the November-December period for the second consecutive year.
As of Dec. 18, the top cryptocurrency was down 28 percent from the opening price of $9,586 seen on Nov. 1.
With reward halving (supply cut) due in May 2020, bitcoin was expected to put on a good show in the final two months of 2018. Historically, bitcoin has picked up a strong bid six months ahead of the halving.
However, prices fell by 17.48 percent in November to register the biggest monthly decline in 12 months. The sell-off was likely fueled by weak miners dumping coins, as noted by prominent analyst Willy Woo.
December is also proving a tough period. The cryptocurrency is currently down 5 percent on a month-to-date basis, having hit seven-month lows below $6,500 earlier this week.
Some observers have associated the recent sell-off with jitters that more of PlusToken’s allegedly ill-gotten bitcoin and ether are going to flood the market.
This year's sell-off, however, is less severe than the 44 percent slide registered in November-December 2018.
The bitcoin market was signaling at the end of October 2018 that a bottom had been made around $8,000. After all, the level was consistently defended almost for five months to October.
The cryptocurrency, however, fell below $6,000 on Nov. 14 and went on to hit a cyclical low near $3,100 in mid-December. |
Eyes Key Resistance
BTC: Price: $7,180 | Market cap: $130 billion | 24-Hr Volume: $22.27 billion
Short-term trend: Recovery likely
Bitcoin is up 93 percent gain on a year-to-date basis, according to CoinDesk's Bitcoin Price Index and is significantly outperforming gold and S&P 500.
Gold, a classic haven asset, is currently trading at $1,477 per ounce – up 15 percent on a year-to-date basis. Meanwhile, the S&P 500 index, a benchmark for risk assets across the globe, is currently reporting a 28 percent gain for 2019. That's the biggest yearly gain since 1997. It's worth noting that bitcoin's yearly gain is actually the second-lowest on record, with the lowest rise of 34 percent being registered in 2015. Bitcoin could still see further upside in 2019, as the short-term charts are signaling scope for a move to resistance at $7,870.
The 14-day relative strength index (RSI) has diverged in favor of the bulls and Wednesday’s big engulfing candle is indicating seller exhaustion.
As a result, bitcoin looks set to test resistance at $7,870 (Nov. 29 high). A UTC close higher would invalidate lower highs setup and confirm a short-term bearish-to-bullish trend change. Long-term trend: Neutral
Bitcoin's monthly MACD histogram has dropped below zero, signaling a bearish reversal. The cryptocurrency is trapped in a five-month bearish channel.
Even so, the outlook remains neutral, as the MACD is a lagging indicator. Further, the miners’ reward halving, usually a price-bullish event, is due in May 2020.
With BTC looking oversold after a 50 percent drop from June highs above $13,800, a notable recovery ahead of the supply-cutting event can’t be ruled out – more so, as the 50-week MA has crossed above the 100-week MA, confirming the first golden bull cross since May 2016.
After all, the previous bull cross had marked the start of a long-term bull market. The cryptocurrency picked up a strong bid near $430 following the bull cross confirmation in May 2016 and charted its way to a record high around $20,000 in December 2017.
That said, the outlook as per the weekly chart would turn bullish only if and when prices break higher from the five-month long bearish channel.
Read Analysis
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Blockstack Takes A Breather STX: Price: $0.11 | MCAP: $50.8 million | 24-Hr Volume: $4.7 million
Short-term trend: Overbought
STX is up 39 percent over the past week, one of the top performing crypto assets over the period, accompanied by some of the highest levels of trading volume since Dec. 15.
The daily RSI is flashing signs of overbought and has begun to pull back from a top of $0.1250 but has found temporary support along a prior region of resistance near $0.1090.
A slew of fundamental updates are set for Dec. 31 including a mining-reward payout upgrade, upgrades to its UX and in-app transaction signing as well as an update to its smart contract language.
Blockstack provides software for internet ownership, which includes infrastructure and developer tools to power a computing network and ecosystem for decentralized applications.
Long-term trend: Bullish
Its long-term market structure is beginning to show strong signs of a reversal from its downtrend from Nov. 28's high of around $0.12.
A fall back below $0.10 aborts the long-term bullish view.
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| | | | Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. |
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