Bitcoin price is back at $37,000, recovering from a frightening plunge to as low as $30,000. The selloff struck fear into the market unlike never before, making buying the dip a scary risk to take.
However, there’s several signs that the bottom could be in, all while sentiment has turned fully bearish and the market expects far deeper lows. Could that in and of itself be a sign the bottom is in?
Recapping The Recent Crypto Market Correction
The recent peak in Bitcoin price was a “top” that very few saw coming even though from a technical standpoint, it was obvious. BTC was moving off exchanges and fundamentals supported much higher prices, but after such a strong run up, the top trending cryptocurrency was bound to correct.
And correct it did – by a full 50% and then some. Historically it is one of the most severe bull market corrections. The severity of the Black Thursday move caused a polar opposite reaction to the upside.
But could a similar severity in the recent collapse also be a catalyst for propelling prices much higher, and not the beginning of a bear market as many would expect? For one, sentiment is ripe for a reversal.
Stacking Up The Signs That The Bottom Is In For Bitcoin
The crypto market fear and greed index is at one of the most frightened readings yet, after spending nearly a full year in greed mode. Contrarian investors all recommend buying the blood in the streets and being greedy when others are fearful. Being fearful while others were greedy, clearly has paid off for anyone who took out a short position at the top – as rare as that may have been.
But there’s a lot more signs out there than that.
BTC bounced right on rising RSI support | BTCUSD on TradingView.com
Perhaps the biggest technical factor suggesting that Bitcoin has bottomed, is the fact that three-day Relative Strength Index has bounced off an ascending trendline that’s supported all of the past bottoms in crypto.
There’s a bounce in December 2018 and again on Black Thursday – and once again now. A similar story can be seen in the chart above which also includes a look at how the 2017 bull market held a similar rising support structure.
A bottom here, suggests one more impulse in Bitcoin before the bull market has ended. That means that the pain from the recent shakeout isn’t yet over, as sellers could be forced to FOMO back in a much higher prices, helping to drive the fury of the final impulse.
Interestingly, the crash landed right where the parabolic curve for the greater bull trend would support another base to rise higher, adding more credence to the bottom being in.
A long-term bull trend is still holding | BTCUSD on TradingView.com
Also on the three-day, Bitcoin price is holding in the Ichimoku cloud after piercing below it. At support there’s a bullish hammer candle forming. If bulls can follow through here and push the leading cryptocurrency by market cap out of the cloud, the bull market will remain unbroken and new highs will be in the forecast.
Remember, technicals said a top was in and no one saw it coming. Currently, things are some what mixed but the case for the bottom builds by the day.
Pantera Capital’s Dan Morehead: Bitcoin (BTC) Already Up 100% in This Bull Run
How big is median increase in Bitcoin (BTC) price in bullish market phases?
As Bitcoin (BTC) reclaims $62,000 level, Dan Morehead, CEO of the first-ever cryptocurrency-focused VC firm in the U.S., shares the comprehensive statistics of the last six bull runs for Bitcoin.
Bitcoin (BTC) price doubled in 87 days: Bull Run 2021
According to the latest tweet by Mr. Morehead, the Bitcoin (BTC) price witnessed a 2x increase in the first 87 days of the ongoing bullish wave.
#bitcoin at $61,000 is 2x from where we mark the start of this new bull market in July.
For perspective, the median bull cycle went up 15x over 300 days.
More thoughts on the state of the market here: https://t.co/g46sxp7Qe6 pic.twitter.com/Iy96sJvZzO— Dan Morehead (@dan_pantera) October 15, 2021
Unlike many other experts, Mr. Morehead identifies two separate “bull run” phases in 2020-2021. During the previous one, between March 16, 2020, and April 14, 2021, it took 394 days for Bitcoin (BTC) to increase its price 13x and print a new all-time high.
According to his infographic, the most impressive rally ended with a 106x increase of the orange coin’s price in 2015-2017.
That said, the median Bitcoin (BTC) price bull run lasted for 300 days and increased the “king coin’s price” by 15x.
Will Bitcoin ETF mark the top of the BTC cycle?
At the same time, according to “The Next Price Era” letter issued by Pantera Capital on Oct. 6, 2021, the hotly-anticipated approval of Bitcoin (BTC) ETFs is listed amidst the possible “sell the news” events.
Mr. Morehead noticed that the launch of CME Bitcoin Futures and Coinbase direct listing triggered painful bear markets:
Will someone please remind the day before the bitcoin ETF officially launches? I might want to take some chips off the table.
As covered by U.Today previously, similar statements were made by CNBC’s Jim Cramer.
The seasoned analyst also revealed his plans to “cash out” 50% of his Ethereum (ETH) bags.
Bitcoin Will Significantly Underperform Altcoin Market As New Crypto Price Era Unfolds: Pantera Capital’s Dan Morehead
The founder and chief executive officer of Pantera Capital says that investors can expect altcoins to outperform Bitcoin (BTC) in the long term.
In a recent edition of Pantera’s Blockchain Letter, the head of the digital asset management firm outlines Dan Morehead’s key quotes from the SALT 2021 conference in New York. During the conference, Morehead said that even though his company has greatly profited from BTC, he emphasized that most future crypto gains will come from altcoin investments.ADVERTISEMENT
“My perspective is: Bitcoin has been amazing – Pantera Bitcoin Fund is up 67,000% since inception. However, I think the majority of future gains will be from tokens outside of Bitcoin. I know that sounds heretical to some people here, but that’s my professional opinion.”
Morehead compares the rise of Bitcoin and its competitors to that of the tech industry boom during the late 1990s.
“It’s like saying in 1998 that [the] majority of future tech gains would come from outside Microsoft.
At the time, Microsoft was worth $218 billion, Apple $3.5 billion, Amazon was $2.2 billion. Google and Facebook were zero – they didn’t even exist. In the years since Microsoft did great – it went up 10x. However, 80% of the tech gains in these five stocks came from outside Microsoft.
That’s the view I have here – I think BTC is going to go up a ton – like 10x. It’s a great investment…[but] I think the broader portfolio is going to outperform.”
At time of writing, BTC has a market cap of $1.156 trillion while all altcoins combined have a market cap of $1.327 trillion, according to CoinMarketCap.
s are now selling ‘way more’ US Dollars to buy Bitcoin
President Nayib Bukele shared this new development on Twitter based on the data acquired from El Salvador’s in-house wallet service, Chivo. President Bukele said:
“People are inserting way more USD (to buy #BTC) than what they are withdrawing from the Chivo ATMs.”
He also urged media outlets to independently confirm the above information by visiting the ATMs. President Bukele further stated that Chivo has reported 24,076 remittance requests “adding up to $3,069,761.05 in one day.”
2 new Chivo Facts:
1. People are inserting way more USD (to buy #BTC) than what they are withdrawing from the Chivo ATMs (any media outlet can independently confirm this by visiting the ATMs).
2. Today, we received 24,076 remittances, adding up to $3,069,761.05 (in one day).— Nayib Bukele 🇸🇻 (@nayibbukele) October 16, 2021
The increase in USD to Bitcoin conversions within the jurisdiction reflects a change in investor sentiment, which initially faced resistance during adoption from the general public. Moreover, the Salvadorean government offers various subsidies for using Bitcoin such as fuel subsidies and tax exemptions.
El Salvador has installed over 200 ATMs after adopting Bitcoin as a legal tender, making it the third-largest network of crypto ATMs after the United States and Canada.
A Cointelegraph report shows that El Salvador exceeded United Kingdom’s crypto ATM count after deploying 205 crypto ATMs, mainly to facilitate local Bitcoin transactions and Bitcoin to U.S. dollars conversions.
Recently, the Salvadorean government announced to build a $4 million veterinary hospital using the profits attained during the Bitcoin bull market. According to President Bukele, the veterinary hospital will host four operating rooms, four emergency clinics, 19 offices, and a rehabilitation area: “We decided to invest a part of that money in this: a veterinary hospital for our furry friends.”