Trading Analyst Breakdown Reveals Why We Might Be in for a Multiple Year Bitcoin Bear Market
During the last few weeks, the cryptocurrency sentiment in the market turned positive. Bitcoin (BTC) and other digital assets started to grow after several weeks being traded close to their lows. Bitcoin was able to test $4,000 even when it was not able to go higher.
This new price increase for Bitcoin was very bullish for the market. Several analysts and enthusiasts started to get excited regarding how far this bullish price action could go. Nevertheless, there is a prominent cryptocurrency analyst that is not convinced about this recent rally. He said that Bitcoin could reach new lows and send the asset into a multi-year bear market.
Josh Rager, a cryptoanalyst and trader, is warning investors that the current price action that helped the community to become bullish once again, could fail at any moment. Due to this situation, Bitcoin could potentially reach new lows.
He explained that if Bitcoin breaks and closes above $4,100 on the weekly chart, is something bullish. However, he said that volume continues to decrease on high time frames. Thus, if there is a decreasing volume with a rising price, this is something bearish.
Bitcoin currently at resistance level with a break and close above $4100 is bullish
Volume continues to decrease on high time frames: the decreasing volume w/ rising price = bearish
— Josh Rager 📈 (@Josh_Rager) February 19, 2019
Since its lowest point, Bitcoin grew over 20%. In December 2018, the most popular digital asset reached $3,250 and reached $4,000 at the beginning of January. Now, Bitcoin is also very close to $4,000 in some exchanges.
As per the analyst, the longer Bitcoin ranges in the $3k to $4k area, the stronger resistance it becomes if Bitcoin does manage to hit new lows.
“I see the purpose of this range not as accumulation but rather another obstacle in a multi-year bear market,” Rager said.
Indeed, Bitcoin reached $20,000 back in December 2017. After it, the digital asset dropped but it was never able to break under $6,000 for a long period of time. Nevertheless, back in November 2018, due to the Bitcoin Cash (BCH) hard fork and hash war, Bitcoin fell under this price that worked as a support level.
Analysts compare the current bear market with the one that was experienced by the space in 2014 and 2015. When Bitcoin fell that time, the recovery phase started with a period of accumulation that allowed Bitcoin to start growing once again.
For Rager, we are not in this stage and the bear market could last for some more months. There were several reports saying that Bitcoin could fall under $3,000 and even reach $1,500.