The markets are currently poised in a fascinating position. We all by now know the carnage of what happened last week but what nobody knows still is the true extent of that dip. Will we recover and see all-time highs in the coming months or was this shake-off simply too rough?
Well, let’s investigate. As of today the price of Bitcoin reached $40k again and was generally looking healthy although it has since dipped ever so slightly. Now, the price consolidation of the world’s largest cryptocurrency is crucial and will be a true indication of what we can expect to see in the coming months.
This might sound very weird for some but many believe that price consolidation at these levels is actually more bullish than if the price quickly reached $50k by the end of the week. This is because consolidation is harder to achieve during a dip sometimes than an increase in price. This is especially true when we have already seen a 30% bounce from the real lows that we have witnessed.
Views are mixed on this and many technical analysis experts are not entirely sure what comes next. Many believe this could be a fakeout and that we are due one more sizeable dip. Tyler S, who has a daily price analysis show on his youtube channel believes that we might see one further dip but he doesn’t expect it to go lower than $33k. If the price were to dip to these prices then it would be worth selling a fraction of your crypto to buy in at this entry-level, however, it is now such a thin margin it is difficult to tell if such a move would be deemed too risky.
We are now exactly a week on from the great crash and since then we have seen 2 fakeouts and a smaller rise that might be too little to be considered a fakeout. This could indicate that we are very soon to be out of fakeouts and unless we are hit by any further news we might all be best placed to hold our crypto and wait for the markets to fully recover again.