Bitcoin Will Struggle To Break $4,300
It isn’t a secret that the broader crypto market has struggled in recent months. After posting close-to-zero gains, or losses during the summer months, Bitcoin (BTC) began to plummet, quickly falling under $6,000 to $5,500, then $4,500, and all the way down to $3,200 in mid-December. While the digital asset has ranged in the $3,000s for nearly six weeks now with no signs of a bullish breakout, optimists still hang onto the hope that the cryptocurrency market could undergo a jaw-dropping, mind-numbing reversal in the comings weeks.
Yet, a leading crypto trader recently doused the fire that burns in the hearts of optimists, taking to Twitter to convey why he doesn’t believe that a seeming ‘bear market rally’ will bring BTC much further than the $4,300 price point.
Murad Mahmudov, a Princeton graduate turned Bitcoin analyst and hedge fund hopeful, recently backed his claim through an extensive thread.
The collective human unconscious often behaves in remarkably similar ways. pic.twitter.com/J9wuS6c0F3
— Murad Mahmudov (@MustStopMurad) January 30, 2019
Over the course of five tweets, Mahmudov, a well-respected analyst, drew lines between Bitcoin’s previous bouts of price action, specifically the so-called “baby capitulation” phase of 2014/2015’s bear season, and that of today. He noted that if history is repeating (rhyming rather), BTC could continue to retest its yearly lows at ~$3,150, before embarking on a one-month-long recovery that could bring the asset to $4,300.
However, citing the crypto space’s previous downturn, he noted that “$4,300 will be very difficult to break,” noting that there are “layers & layers” of technical levels, including an array of resistances, that could disallow BTC from breaking out of that region to new year-to-date highs.
More specifically, he noted that there are key “diagonal, horizontal, Gaussian, & MA resistance” levels in that zone, subsequently adding that BTC could collapse following its inability to break past the strong line of resistance, which is only accentuated by the backdrop of a mid-term declining trendline that is drawn impeccably.
Crypto May Stumble To Lower Lows
While Mahmudov’s aforementioned analysis may seem as though BTC could continue to range trade between $3,200 and $4,300, his little quip — “if we even bounce there” — accentuates how he believes lower lows are inbound for this nascent market, including for Bitcoin.
Staying cohesive with a trendline originating from Bitcoin’s $20,000 top, established in the auspicious month of December 2017, through the medium of a chart, Mahmudov noted that BTC could potentially fall to $1,700 by mid-April. However, he subtly hinted that Bitcoin’s potential ability to hold the $2,000 price level will precede its run to the proverbial moon, where crypto’s most fervent believers, traders, and analysts seemingly want to ‘travel’ to.
This recent thread comes just weeks after Mahmudov noted that:
If the above dynamics are correct and history does indeed rhyme – which is a big if — We can expect a 1700-2200 bottom in the Spring (most likely April).
Outside of technicals, the Princeton graduate explained that fundamentally, many altcoins, such as Ethereum (ETH), EOS, and XRP, are still drastically overvalued, especially considering their often misconstrued and sometimes non-existent value propositions.
Title Image Courtesy of Hektor Ehring Jeppesen via Flickr and Bitcongress
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