Analyst: If History Rhymes, Then This Latest Bitcoin Pullback is Nothing to Worry About
Much to the chagrin of Bitcoin investors, the cryptocurrency has once again extended the downwards momentum it first incurred earlier this week when BTC failed to break above its freshly established 2019 high at $13,800.
The recent pullback has dampened the euphoric market sentiment that was created by Bitcoin’s recent parabolic surge, but one prominent analyst is now noting that previous uptrends have incurred notable pullbacks, which means BTC’s latest drop may be nothing more than a fleeting flash in the pan.
Bitcoin Quickly Drops Below $10,000 as Bears Come Out Swinging
At the time of writing, Bitcoin is trading down just under 10% at its current price of $10,250, down significantly from daily highs of over $11,400.
BTC has been facing increasingly bearish selling pressure over the past few days, which has put its newfound position within the five-figure price region in grave peril. Despite this, it did post a decently strong bounce earlier today after it briefly tapped $9,900, which signals that its bulls are not ready to surrender yet.
Additionally, over a longer time frame Bitcoin still remains in a clear uptrend, as it is up well over 100% from its 2019 lows of approximately $4,000 and is up significantly from its 2018 lows of under $3,400.
One factor that could be contributing to the downwards pressure BTC has faced lately is the CME Futures gaps it formed during its recent parabolic ascent, and Josh Rager, a popular crypto analyst on Twitter, recently noted that it is very close to closing its last gap.
“$BTC CME Futures gap was explored down to $10,160. First gap would be filled at $10,015. Currently a $200 premium on CME so price did not hit sub $10k like spot exchanges. 4 digit Bitcoin price was quickly bought up at the moment. Resistance currently at $10,800 area,” he noted.
Bears Beware, Pullbacks Are Normal During BTC’s Parabolic Surges
Importantly, although it does seem as though Bitcoin’s upwards momentum is currently in jeopardy, analysts are noting that pullbacks during uptrends are historically quite normal, and BTC typically finds support around its 50-day EMA.
Cantering Clark, another popular crypto analyst on Twitter, spoke about this in a recent tweet, referencing the 101 pullbacks that BTC incurred during its upwards ascent in 2015.
“From Nov. 10th, 2015 after the 1st parabolic break out of a bear market $BTC tested the 50 EMA 101 times up until the ATH. 101 times of contact- From above, under, or riding upward. At some point sideways prices will cause MAs to align with price, but we haven’t touched it yet,” he explained.
Although Bitcoin does still have some room to fall before it touches its 50-day EMA, investors shouldn’t be too concerned, as this may all be simply part of the journey BTC is currently on back up to its previously established all-time-highs.