Is the bottom in? Since Bitcoin (BTC) fell precipitously to $6,600 late last month, analysts have been asking if the leading cryptocurrency has finally found a price bottom after a multi-month downturn.
Analysts have understandably divided over the question, as the correct answer would show in which direction Bitcoin will head for the next couple of months. Some are bullish, others are bearish.
Cold Blooded Shiller, a popular full-time trader, recently laid out the case that the bottom is not yet in, citing a form of analysis pioneered by prominent chartist and technician Richard Wyckoff.
Is the Bitcoin Bottom Really In? Wyckoff Schematics Says No
Shiller recently noted that as it stands, Bitcoin is in a “markdown from distribution” near the $13,000-$14,000 top, a markdown contained by a descending channel that has existed since the top of the recent bull run. When the top of the channel is hit, sellers dump their coins; when the bottom of the channel is touched, buyers step in, pushing the price back towards the middle of the channel.
As it stands, Bitcoin at $7,400 is in the middle of the channel, seemingly in no man’s land, thus not close to a bottom.
“From a volume perspective, there is nothing to me that screams “THIS IS THE BOTTOM.” For both markdowns and markups we typically expect to see “climactic” volume,” Shiller wrote, trying to accentuate that there are no concrete signs the bottom is in for the Bitcoin market.
Shiller concluded that for him to acknowledge that a bottom is in, Bitcoin will have to rapidly move out of the abovementioned descending channel on a large influx of volume, implying a selling climax, to fall into support, bounce, then continue sideways in preparation for the next macro move. The scenario he is expecting can be seen below, which shows that the leading cryptocurrency could return into the low-$5,000s, a range that has been identified by other analysts as a potential macro bottom.