DAMN what a day!!
The crypto markets are seeing massive losses. Absolute blood shed across the boards hey
Some people might say its a crash or its a bubble popping or whateva.
But for people who believe in the blockchain and where it will take us, we are all thinking, its a SALE! haha its a bargain!
SALE SALE SALE!!!
Lets actually look at the charts and see whats happening and also to reassure the newcomers that it is not all doom and gloom.
1D
So Bitcoin had an All Time High of 20k ($19666 to be exact on BITSTAMP). Its lowest value over the last few weeks (which its now touched twice is around $11159.
Do the maths and that's a 40% drop in value from its All Time High.
Things to note on the chart is that BTC has touched this low twice now, and has bounced off it twice. So this says there are quite a few ppl on the sidelines buying it around this zone.
Secondly, this level is the 38.2% mark, which if you spin the Fib Retracement around is also the 68.1% level. This is an important level.
Thirdly BTC got very close to the 100D Moving average.
What does this all mean?
Lets go back a little bit for the newcomers and do some memory jogging for people that have been around a little while.
The next chart is of BTC from the July 2017 Low up to the Sept High, then Sept Low.
At this time, there was all the news about China banning Crypto Exchanges and all ICOs. This affected the market and there was also blood shed everywhere.
Things to note however.
- Its high was $4979 and its low after the high was $2972. Do the maths, 2972/4979 = 59%. Which is a loss of 41% value.
- The low's wick touched the 38.2% Fibonacci Retracement line.
- the low's wick also touched the 100d MA line
Seems familiar?
At the time of this correction, it was doom and gloom as well, with the news of China banning exchanges and ICO spread across all news sites etc.
Let's go back even further.
The chart below is from a low in March 2017, to a high in June then to the low in July, which was used in the above chart.
Again, lets look at a few things.
It's high was $2980 and its low after that high was $1830. Some maths again, 1830/2980 = 61.4%. Which means BTC lost 38.6% of its value over that correction.
The low passed the 48% Fib retracement level
And the price went back to the 100D MA, then quickly went back above it after 2 days.
This all sounds too familiar right?
Yes the above example didn't get down to 38.2% but this ain't science.
Lets go back to the start of 2017
In this snap shot in early 2017, there were two times Bitcoin corrected back and touched the 100D MA
As you can see the price of BTC corrected by 33-34% each time back to the 100D MA.
So as you can see, and should have been aware when stepping into the Crypto world, prices are volatile. Extremely volatile.
But to help calm your nerves, bitcoin has done this same type correction many times before.
Also remember what the meaning of an Average is, and the price action MUST return to the moving average at some point.
So if you are sitting on some decent losses, but still believe in blockchain, then HODL. or if you think it will head lower more, sell out and buy back again at a lower price?
I personally think there could be just a little bit more down side to go, as it hasn't touched the 100D MA yet on this correction yet, but i wouldn't be surprised people think the current price is a bargain and start pushing up the prices again.
The RSI also isn't near the Oversold level just yet, which it has done in all previous correction.
Hope the charts above and explanations help some people feel a bit better with this current correction.
These are just my opinions and reading of the charts. I'm not to phased about this correction and I'm still optimistic with bitcoin and other Alt coins.
Good Luck
HODL STRONG!