Many have been awaiting a huge correction the Bitcoin usually faces after making significant gains. Despite last year, increasing about a 1000 percent in value the Bitcoin did not see any long-term sustained market corrections as it is seeing now along with other cryptocurrencies. So as the cryptocurrency "massacre" continues which was initially started by authorities in Asia regulating the Bitcoin via a complete mining ban in china and ban on exchanges in South Korea leaving many wondering how exactly should one trade in such a situation and when exactly will the markets pick up again and when should investors seek to buy in again?

Is it a good time to invest?

One of the top questions we have recently been asked is whether now given that the Bitcoin has dipped by almost 50% since its all-time highs of December last year, is it finally a good time to invest in the Bitcoin once again? Maybe but unlikely as the Bitcoin seems to be entering bullish territory once again by trading around the 100 MA (moving averages) it is still just below the resistance line at times, we at this point in time don't recommend buying in again. Further analysis -

Why it may dip further

  • Dipped below resistance but still around the resistance mark
  • Dipped below the hedge formation thus showing the Bitcoin is in bearish territory
  • Bitcoin is bouncing off pattern line which is showing that it is testing support, however a lack of consolidation keeps pushing it into the bear market
  • Parabolic trend appears to show Bitcoin is also in bearish territory
  • Massive selling volume as it dipped below $12,800 critical support but slowly climbing back up

Why it may rise further

  • RSI is in oversold territory and we may expect the price to bounce at around the $8,500 mark, the price has not been so oversold ever since the November 12th major price rise which saw the Bitcoin go from around the $5,800 mark to above the $19,000 mark
  • Daily chart shows the Bitcoins price has fallen on a major historical trend line which marks the beginning of every major price increase in the Bitcoin

How to trade the Bitcoin

  • Following the bearish trend line, we are looking for support at the $8,500 mark and firm consolidation and bullish PA (Price action) before making any moves
  • If it dips further support will most likely be found at around the $5,000 major support mark with it eventually testing resistance at around the $8,400 mark
  • The most important thing is to look for firm consolidation and all-time charts lining up in a bullish fashion, lastly look for a price action signal to confirm it's in a bullish market

What next?

Despite numerous Bank's and institutes warning against the Bitcoin, it has proven them wrong countless times.

Not much, wait patiently and look at the silver lining as this is a good opportunity to enter in once again, this could be a chance for all those people who feel like they have entered the market in too late to enter once again and given that the Bitcoin had reached almost $20,000 in the past there is nothing to state it will reach that mark or even surpass that mark again.
© ALL RIGHTS RESERVED