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Bitcoin, Cardano and Ripple (XRP) are on the rise – is the trend reversal coming?

  • Bitcoin’s price yesterday rose by 800 USD within a few minutes, so BTC was trading above the 7,000 USD mark at the time of writing.
  • Ethereum and XRP as well as other Altcoins followed the trend and also show a short-term recovery.
  • Many analysts see the support of 6,400 USD confirmed, so Bitcoin could now show a trend reversal.

On December 17, 2019, Bitcoin fell below the USD 6,800 support level. A short time later, the price dropped sharply to USD 6,450. However, the price bounced off this support zone and rose by more than 8% in the last 24 hours to 7,200 USD.

Is a trend reversal now following?

Many analysts warned that if bulls do not enter the market due to the low price, a further descent to USD 5,500 or even USD 5,350 is possible. However, some whales appear to have placed buy orders at the 6,500 USD level, so Bitcoin has bounced off the critical trend line and may now be on its way to test the resistance at 7,300 USD.

The experienced commodity trader Peter Brandt confirms on Twitter that an important support has held and Bitcoin could now show a trend reversal.

The community, on the other hand, describes that it is still too early to draw early conclusions from Bitcoin’s current price movement. The economist Alex Krüger asked his followers on Twitter whether Bitcoin had already reached the bottom. 42% replied that they are not convinced and that Bitcoin could fall further.

Looking at the RSI on longer-term charts, a six-month downtrend continues. Also the sudden spike after reaching the supposed bottom at 6,450 USD is not sufficient to reach a daily RSI above 50. Only when this can be broken may further gains follow.

Bitcoin has also filled the CME gap that appeared on the chart from December 14th to 15th. In Bitcoin’s history so far, these “gaps” have almost always been closed. These occur when Bitcoin’s price changes significantly during market closing hours in the traditional CME financial market.

If the CME reopens its markets, there will be a difference between the closing price and the opening price and thus a “gap”. Due to the fact that the CME only offers its cash settled Bitcoin futures during business hours during the week, some such “CME Bitcoin Future Gaps” have arisen since December 2017.

The gap between 14 and 15 September was closed by the short-term spike. Whether these gaps are a reliable indicator for a rising or falling Bitcoin price remains controversial in the community.

Ethereum, XRP and other Altcoins followed the short-term market sentiment, but could not all show the same development. The biggest winners within the top 20 (measured by market capitalisation) are Cosmos, + 7.90% and EOS + 8.68%. An overview of the price movements of all cryptocurrencies can be found here. The market capitalization of all cryptocurrencies rose to USD 187 billion at the time of writing.

Bitcoin Futures on Bakkt reach new all-time high

At the same time, the Bitcoin futures on Bakkt reached a new all-time high of 5,690 BTC, around USD 39.8 million. Although the existing volume is still too low to trigger large price movements in the cryptocurrency market, this development shows that demand in this area continues to rise.

Bakkt introduced Bitcoin options and Bitcoin futures, which are settled in cash, on December 09, 2019. These products are intended to provide investors with better protection for their invested capital and thus reduce their investment risk. Bakkt thus follows the increasing demand of its customers and gives investors further opportunities to hedge their profits and reduce their risk.

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About Author

Collin Brown

Collin is a Bitcoin investor of the early hour and a long-time trader in the crypto and forex market. He's fascinated by the complex possibilities of blockchain technology and tries to make matter accessible to everyone. His reports focus on developments about the technology for different cryptocurrencies.

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