Bitcoin already trading at the lowest price over the past year. In the last 24 hours, the Cryptocurrency market has been bleeding. Bitcoin already crashed by 14.6% as price moved from $6500 down to the current low at $5500. This is a huge USD1000 drop in a very short timeframe, and the downside momentum might increase even further.
Only true believers in Bitcoin would buy it under the current market condition. Obviously it would be an extremely risky choice, although over the long term, keeping the Bitcoin still can pay off. But what if Bitcoin will crash completely? Where is that point of no return? When the risk/reward is optimal?
Now we’ll try to answer all those questions.
Bitcoin - the King
The blockchain technology is getting wide adoption with a massive use case throughout many industries. At the moment it seems there is no chance that it will just disappear, but quite opposite. From the other hand, it is not necessary that Bitcoin will be leading the way, and remain the Kind of cryptocurrencies. Perhaps in the future there will be the “ONE” who will push the great Bitcoin aside. But it does not necessary mean that the price of the Bitcoin will collapse. BTC might not be the most popular cryptocurrency, but it is likely to remain the most trusted one.
Point of no return
Ok, let's consider the scenario where Bitcoin will loose the status of “most trusted” coin…. Important: Not the blockchain technology, but only the Bitcoin. In this case it would be reasonable to expect capital moving out of BTC to other altcoin/s. Indeed the price of BTC would go through a great suffering, turning the long term uptrend to a long term downtrend. And this could potentially be that scenario of no return. But what is the probability of that happening???
Let us know down in the comments below.
Price of interest
Now it is reasonable to talk about the risk/reward. No one knows the future, but if Bitcoin will remain the coin of “trust’, the price is likely to increase over the long term. The buying opportunity is there, if thinking of a long term investment. Although to minimize the risk and maximize the reward, traders could be waiting for the lower entry price. Based on the ascending channel and Fibonacci retracement level, strong support level is based near $4800, that is 78.6% retracement . This could be a very interesting point of entry for some investors, but of course a risky one. It’s because if the support is penetrated, Bitcoin could crash even further to test $2.9k level that is 88.6% Fibonacci retracement . At $3k area there might be another hot buying opportunity of the Bitcoin. But if or when it will get that low is a big question.
Positive scenario
In the near term, the $4.8k support would probably have a lot of attention. If this level will be rejected, uptrend continuation can take place. One of the possible scenarios that BTC will go as high as $40,000, but perhaps only by the end of the next year.
In any way, Bitcoin already entered the support area , which is between $4,800 and $5,755. In this area Bitcoin could spend quite a bit of time, nevertheless under the heavy volume there can be some fast and unexpected price movements in any direction.
See the latest prices across multiple exchanges at https://www.cryptaldash.com