We have seen some pretty bullish Bitcoin price action over the past few days. However, when the momentum turns against the world’s leading cryptocurrency, all markets will suffer. Right now, the Bitcoin price is heading back toward US$5,500 all of a sudden. There is no clear reason for this sudden reversal, and it remains to be seen how long it will take before the Bitcoin price returns to its previous levels.
BITCOIN PRICE DOWNTREND ISN’T WORRISOME YET
As was somewhat expected, the weekend brings us a negative Bitcoin price trend. Although things looked pretty decent yesterday, we have seen signs of a small correction starting to become visible as early as Friday afternoon. Given the recent bull run all the way up to nearly US$6,000 over these past few days, it was only a matter of time until things would retrace at some point.
One has to admit a brief Bitcoin price correction doesn’t have to be a bad thing. The most recent correction kept the price below US$4,500 for a while, yet eventually allowed the price to break the US$5,500 resistance in short order. The current retracement is pushing the Bitcoin price down toward US$5,500, which is a necessity before we can attempt a run at US$6,000 once again.
Although this current price dip comes out of the blue, it is only normal would see such a shift. The weekend is often pretty boring or troublesome for cryptocurrency trading. This weekend has been no different in this regard, at least where the Bitcoin price is concerned. It is nothing to be even remotely concerned about, mind you, as manipulation and speculation are slightly more lucrative ventures over the weekend. If the price were to drop to US$5,000 or lower, one should get slightly concerned, though.
One thing to keep in mind is how Bitcoin is still noting a nice trading volume. Compared to previous Sundays, the 24-hour volume is almost twice as high. With US$1.89 billion worth of cryptocurrency changing hands across all global centralized markets, there is no reason to think the demand for Bitcoin will dwindle in the near future. In fact, it seems more likely we would see a nice bounce in the next few days.
Not a day goes by without Bitfinex leading all Bitcoin exchanges in terms of trading volume. The platform is still well ahead of Bithumb and bitFlyer, although it seems the gap is shrinking a bit. Bithumb still values one BTC at nearly US$5,570 right now, though, which seems to confirm this is only a small dip to be bought up. Once again, it’s nothing to worry about in the slightest, as we will not necessarily see dirt cheap bitcoins anytime soon.
All of this goes to show cryptocurrency markets remain volatile at every turn. There is a lot of speculation and manipulation taking place on a regular basis, and Bitcoin is no exception in this regard. Things will look very different when we head into next week, but it remains to be seen if the Bitcoin price will go up again at that time or move even lower. These are exciting times for the cryptocurrency community, though; that much is certain.