The Bitcoin Bottom: $5,800 is Critical Support Level, BTC Saving Grace in 2018
Looking at any graph of bitcoin’s performance in 2018, the number $5,800 is conspicuous. This support level has been tested multiple times in Feb, April, June, July, and August as evident from the graph below.
The first time Bitcoin’s price soared above USD 5,800 was in October 2017 and apart from a brief dip in November 2017, it has not gone that low again. During November and December 2017, Bitcoin saw its biggest rally in history, with the price rapidly accelerating to a peak of USD 20,000. Much of this rally was based on the fact that Bitcoin is better than fiat since it is cryptographically secured, decentralized, and efficient and cheap to send anywhere in the world. Still, the rally had a bubble element that caused the price to go up too quickly.
As everyone is already aware of, Bitcoin’s price came crashing back down to Earth and by early February 2018, it hit a local minimum of USD 6,000. This represented a hard crash of 70% in only three months but Bitcoin bounced off the USD 6,000 level and went back up to USD 11,500 by early March.
The value of Bitcoin then dropped again, getting as low as USD 6,500 in early April. Once again, it bounced back up off this support level and was USD 10,000 by early May. It then went into a uniform decay that brought it as low as USD 5,800 in late June, possibly imperceptibly lower than USD 5,800 briefly.
Bitcoin’s price climbed upwards, to as high as USD 8,500 as speculation about a possible Bitcoin exchange-traded fund (ETF) propagated in the crypto space. Once this speculation was crushed by a series of dismissals by the US Securities and Exchange Commission (SEC), Bitcoin went into a downtrend again and neared the USD 5,800 level in the middle of August.
Bitcoin (BTC) seems to have made a recovery the last few days but since the beginning of this month, it has been trading in a big rising wedge that extends all the way to Bitcoin (BTC)’s downtrend resistance.
The market will be shifted fundamentally if bitcoin’s prices fall below $5,800, however, till then we can place our bets on this mark which has held steady on multiple occasions.