The world’s leading cryptocurrency today took a drop of over 5% as it fell to $8,280 level. Currently, BTC/USD is trading at $8,308 while managing the daily trading volume of $768 million on top ten exchanges with real volume.
According to trader and investor Bob Loukas, who has been previously expecting BTC price to climb to $9,500 level, the crypto asset has found the top of this cycle and the accumulation will begin here.
“I believe we topped for the Cycle. Perfectly normal, was a good run. Early to mid Feb is the next Cycle Low timing band. Expecting a period of serious accumulation here as it trends slightly lower. From the Feb low, a new uptrend to begin made of Right Translated Cycles,” said Loukas.
Bitcoin’s Drop Below $8,300 “Nothing Special”
The loss in BTC price has been already called out by several industry commentators. Also, during and after the Chinese New Year, these kinds of losses ae “nothing special,” notes economist and trader Alex Kruger.
Chinese New Year this time is falling on Saturday, January 25th. This new year is the year of the Rat that symbolizes new beginnings in Chinese culture.
As per the data shared by Kruger, during this period the flagship cryptocurrency remains cold, not seeing much activity. Bitcoin has recorded a daily average return of as low as 0.6% in these past 9 years following New Year.
Last week Kruger shared that while some think the Chinese New year may impact the price negatively as people sell BTC to purchase presents, this isn’t the case.
In the days preceding the big day, the data painted a rather positive picture. It has been rather in the daily average five days preceding “NY-7” that showed “notable underperformance.” This would have fallen between Jan. 12 and Jan. 17, during which BTC price jumped 10%.
Volatility and Volume to Nosedive
While wishing a “Happy New Year” in Chinese, Arthur Hayes, CEO of BitMEX, a popular crypto derivatives platform has predicted a plunge in Bitcoin volatility and volume.
We have already started to witness the decline in volume as from last week’s $1 billion and the week before that’s $2 billion, yesterday we fell to $500 million and now remain below $1 billion mark.
BTC ATM implied volatility has also fallen 10% as crypto analytics firm Skew notes, “Sellers of short dated puts ahead of the Chinese new year putting pressure on implied volatility. Dealers expect a quiet market due to the holiday. Spot market is telling a different story & trades down a couple of % today.”
Bitcoin’s Loss Might be Altcoins’ Gain
While Bitcoin seems to have found the top of its cycle, altcoins are preparing for a bull rally. Trader Crypto Rampage says we are seeing a big double bottom.
Double bottom is a twice-touched low which is considered a support level. This patterns according to Investopedia, “always follows a major or minor downtrend” in a particular asset and “signals the reversal and the beginning of a potential uptrend.”
He illustrated how ETHBTC, the leader of the altcoin market cap is currently at the same levels it was at six months into its launch in early 2016.
Highaltitudeinv is another one who is seeing the double bottom in altcoins cycle and expecting a breakout. But this is not all, he points out how altcoins are following Bitcoin’s early cycle of 2011-2012 perfectly, even the volume part.
Currently, altcoins are falling harder than Bitcoin just like they soared higher than the digital asset. Now, it remains to be seen if this will really be an alt-season or just another short rally.