Bitcoin Could Have Bottomed After The Recent Price Decline
Earlier today, Bitcoin (BTC) fell to $6,600, a price level that nobody was expecting just a few weeks and months ago when the only topic discussed was the upcoming halving.
However, after reaching that value, Bitcoin surged around 10% and remains traded close to $7,150 in some exchanges.
This situation experienced by Bitcoin has also affected the liquidity in the market. Bitcoin’s spread has reached its widest point in the last three months.
Did Bitcoin Reach Its Bottom?
Bitcoin could have reached its bottom after falling to $6,600. According to the cryptocurrency analyst Scott Melker, Bitcoin is currently showing a potential bullish divergence with oversold RSI on every single time frame below 12 hours.
He then mentioned that the bottom is ‘likely close’ and that he remains well in profit on both of his $6,900 area buys.
$BTC 12 Hour
Beautiful reversal candle. Nice long wick. Oversold bullish divergence. Number went up.
Well in profit on both of my $6,900 area buys. pic.twitter.com/HVKbvojCGV
— The Wolf Of All Streets (@scottmelker) November 25, 2019
Nonetheless, this recent activity has also created a situation in which Bitcoin liquidity evaporated very fast.
According to Gabor Gurbacs, markets can easily move into any direction if a large market order is being put in place.
Bitcoin liquidity evaporating fast as indicated by the sharp widening of bid-offer spreads on a sample $10million trade. Bid-offer spreads widest in the past 3 months. Be careful out there. Market can snap fast any direction. Ease into positions. Avoid large/any market orders. https://t.co/44BEoqMA67
— Gabor Gurbacs (@gaborgurbacs) November 25, 2019
Bitcoin has also been trading on a downtrend channel since the end of June this year. Despite the recent surge experienced by the cryptocurrency after China’s push for blockchain adoption, the most popular cryptocurrency continued falling.
Bitcoin is currently being traded close to $7,175 and it has a market capitalization of $129.73 billion.
Other digital currencies have also been affected by today’s Bitcoin’s performance. The virtual currency market tends to follow the general movements and oscillations of Bitcoin.
Nevertheless, many altcoins are reaching new lows while others are close to their lowest point in several years.