Last November 13th Bitcoin’s price in $6,000 and that was when it took off until it went beyond $17,000 on December 17th and, on the next day, the bears took over the market. It’s been going down since that day. Then November 14th of this year arrived and BTC plummeted, and then it went down again over the next weekend.
It was a slaughter. It went under 5k, so we all thought that 4.5k would be a good support level. It broke it and we thought the same about the 4k level, which it also broke. How low can it go? Will it go all the way to 3k? Maybe even lower, back to the 2014 level of $2000? We hate to give you bad news but it’s just possible.
The market is heavily oversold right now, but that, unfortunately, doesn’t mean it’s about to bounce back. All it means is that selling pressure is very intense. Over the last 24 hours, it’s recovered a little and Bitcoin is higher than 3.5k as we write this, but is this a fluctuation before a new fall or is it going to stay stable for a while now? There’s no way to know.
How Bitcoin market works
So this would be a good time to stop and think about the way the Bitcoin market works so we can visualize the circumstances in which things could improve, whenever they do.
Let’s start with the most obvious thing. This market has no institutional players. Wall Street and the traditional financial system have not overcome their Bitcoinphobia yet. This is a market that’s dominated by retail investors for the most part. Yes, some of them are very rich and can move a lot of money around, but they’re still private citizens, not institutional investors.
Rumors of institutional money pouring into crypto have been floating around the cryptosphere all year long but nothing’s happened yet. This is very important. It’s a big injection of money into Bitcoin, of the kind that only institutions can manage, what could bring about the next bullish market. It’s not the only factor, but it would go a long way. It’s not just about the money. If the world sees how the financial institutions trusting Bitcoin, that will breed a lot of confidence in everybody.
Another hand could come from Silicon Valley investors. Earlier this year, a bull run on Apple stock brought the company’s worth over a trillion dollars. And now it’s happened again, this time for Microsoft, which is now even bigger. These are the kind of investors who understand technology and are willing to trust it and invest in it. It’s the ideal bunch of people to become interested in Bitcoin and other cryptocurrencies and stop the current bear market. They will come into crypto, sooner or later, but when?
One thing is kind of clear: there are no serious predictions signaling an imminent change of trend. The Elliott Wave model needs two more correction waves before the cycle starts again, and some analysts are talking about a three-year-long bear market before it goes back up.
We don’t even know if we already hit rock bottom because, just when the price was headed for 3k, it bounced back, but only to 4k, it didn’t really start a new trend.
So what will happen? We’re pretty sure the market will recover, and reach new heights. That’s what it’s always done. We just don’t know when or how.
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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.
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ur welcome pic.twitter.com/e2KF57KLxb
— Elon Musk (@elonmusk) February 4, 2021
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Hong Kong, Hong Kong, 25th January, 2021, // ChainWire //
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