After incurring a bout of capitulation throughout the latter part of yesterday, Bitcoin (BTC) has been able to post a decently strong rally that has allowed it to recapture its position within the lower-$7,000 region, and its recent lows may ultimately mark a long-term bottom for the crypto.
It is important to note that the latest rally came about after the cryptocurrency tapped a key trendline that kicked off the 2019 bull run earlier this year, and a continued defense of this level could help bolster the crypto’s mid-term price action.
Bitcoin Bounces at $6,500 as Bulls Fight Back
At the time of writing, Bitcoin is trading down marginally at its current price of $7,200, and it has been able to erase a significant amount of the losses that were incurred yesterday evening when BTC dipped to lows of $6,500.
It appears that $6,500 is a strong level of support for the cryptocurrency, as its visit to this region was instantly followed by a strong influx of buying pressure that sent it back to the $7,000 region, leading some analysts to believe that this could mark a mid-term bottom.
One factor that should be carefully considered while determining whether or not $6,500 is a bottom for Bitcoin is that the “fear and greed” index – which is widely viewed as a contrarian indicator – is showing that the market sentiment surrounding BTC is “extreme fear.”
Mr. Anderson, a popular cryptocurrency analyst on Twitter, spoke about this in a recent tweet, saying:
“$BTC Fear & Greed: Extreme Fear is warranted. They will push until pushed back. The novice should stay on the sidelines. Pros should enjoy the volatility. Typically, the only way out of these scenarios is to bounce out. Expect turbulence.”
BTC Bulls Defend Key Trendline
In addition to the extreme fear currently overshadowing the crypto markets – which may prove to be a bullish counter-indicator – Mr. Anderson is also noting that BTC’s bulls are ardently defending the trendline that sparked the bull run seen in early-2019.
“$BTC Log-To-Linear Trend Line: $BTC is trying to put up a fight on at its Linear JUMP OFF trend line that kicked off the Bull Market. As we can see she dumped upon losing the last Log Parabolic Trendline and dumped straight to this Linear Trend Line. Let the battle continue,” he noted.
How Bitcoin trades in the coming few hours may illuminate how it will trend going into the final weeks of 2019.