Just like the miter of Sinterklaas, the crypto market turned all red this weekend. The price of bitcoin suffered a loss of no less than 25 percent. Was this the last dip before a new all time high?
It was a shock for the people who opened their portfolio on Saturday morning. Huge losses were incurred in the night from Friday to Saturday. The crypto market fell most violently around 5 a.m.; about twenty percent in half an hour. Bitcoin decreased from about 52,000 to almost 42,000 dollars (46,000 to 37,400 euros). The price managed to recover at this low point and rose back to 48,000 dollars (42,500 euros) within a few hours.
What do we see now?
Bitcoin jumped from $42,000. This happened around the zone that served as support in September of this year. From here, bitcoin recovered slightly, only to hover between $47,000 and $50,000 (EUR 41,500 and $44,300).
As seen in the chart above, bitcoin has hit a known point with this dip. Before shooting back to $48,000, bitcoin hit the spot that served as resistance during the ‘corona crash’. Such a support/resistance flip is usually a change in the market structure, and this was proven in November. Bitcoin first made a higher high before this Sinterklaas dip happened.
Looking at the market structure on the daily chart, nothing bad is going on yet. Bitcoin has hit an all-time high with its November high. Coupled with last weekend’s dip, bitcoin is still in an uptrend. If this market structure continues, it means that a new high is conceivable. The market trend is still bullish with this.
Price Expectation
The real concerns should only come when the price closes below the support zone of about $40,000. This would confirm the start of a downward trend. In that case, the next support is at 30,000 dollars (26,600 euros). This could be quite a battlefield as it would represent a nearly 40% drop from the current price (at the time of writing).
Don’t be alarmed just yet, as a happier scenario may also take place. If the price remains above the support zone, then the previous all time high (and maybe even above) is a realistic target. This would mean that the current uptrend is not broken yet, and new highs are just being set.
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