After a week of consecutive losses to reach the RSI oversold area BTC short-term record low is less likely?

The latest data shows that Bitcoin has reached oversold territory on the RSI for the first time since March 2020, so don’t sell when BTC is already oversold.

After a week of consecutive losses to reach the RSI oversold area BTC short-term record low is less likely?

Since the “519”, bitcoin has been falling one after another, nearly cutting down, and “bitcoin plunge” has been on Weibo hot searches for several days. However, the latest data shows that Bitcoin has reached the RSI oversold area for the first time since March 2020, so don’t sell when BTC is oversold.

It is reported that RSI, or relative strength index, is an indicator of relative strength and weakness, which determines the future trend of market prices based on the comparison of momentum between an uptrend and downtrend. RSI less than or equal to 30 indicates that the situation is oversold or undervalued, and the current RSI value is 28.48.

Charles, an analyst at OKEx, pointed out in an interview with Golden Finance that the recent impact of multiple negative news fermentation and the continued release of market panic has led to a significant drop in coin prices, but from a technical perspective the MACD indicator in the 4-hour level chart, which represents the market’s medium-term trend, has a continuous bottom divergence phenomenon, indicating that the market’s active short selling power and persistence are declining. The above phenomenon indicates that the short-term trend has a relatively strong demand for rebound, and the probability of a new low in the short term is relatively small.

Meanwhile, the crypto market saw a rebound in the evening of the 24th, with 87 up and 13 down in the top 100 coins by market capitalization. In addition, according to companion data, the annualized term-current spread of bitcoin was 5.71% on May 25, up 1.22% from the previous day, and the market sentiment index was “optimistic”.

Long-term buyers are actively buying bitcoin
At the same time, bitcoin has also “changed hands” during this deep decline, and large bitcoin holders appear to be actively buying bitcoin during the recent price correction, according to the May 24 news release. Anthony Pompliano from crypto investor Morgan Glass Digital said he analyzed Glassnode data and found that bitcoin giants holding between 10,000 and 100,000 BTC bought a total of 122,588 BTC since the market crashed last Wednesday. crypto hedge funds that were also involved in the purchases and were actually bottom buyers, including London-based MVPQ Capital and ByteTree Asset Management, as well as Singapore’s Three Arrows Capital. Kyle Davies, co-founder of Three Arrows Capital, said, “Every time we see a lot of liquidation it’s a buying opportunity, and I wouldn’t be surprised if bitcoin and ethereum could retrace their entire decline in a week.”

On May 24, Morgan Creek founder Anthony Pompliano tweeted, “On-chain metrics overwhelmingly show that new bitcoin holders are selling to those who have been in the bitcoin space for years. Weak newbies are selling (bitcoins) to strong long term buyers.” On the same day, Grayscale founder Barry Silbert tweeted, “It’s healthy that many cryptocurrency traders are turning into long-term investors. “

Notably, John Bollinger, creator of the Bollinger Band indicator, tweeted, “BTC/USDT is fluctuating at the bottom of a short term W in a reasonable position. Developing risk/reward looks good.”

The average return is still as high as 30%
May’s bitcoin decline was the largest monthly drop ever, a record high. Nonetheless, current data shows that the average return still tripled in 2020 as the total amount of crypto hedge funds’ assets under management grew by 90%.

According to the annual Global Crypto Hedge Fund Report, released by PwC and investment firm ElwoodAssetManagement in partnership with the Alternative Investment Management Association (AIMA): total crypto hedge fund assets under management reach $3.8 billion in 2020, up 90% from $2 billion in 2019; the average crypto hedge fund returns in 2020 reach 128% , a threefold increase from 30 percent in 2019; 47 percent of traditional hedge fund managers surveyed have invested or are considering investing in cryptocurrencies; the percentage of crypto hedge funds with more than $20 million in assets under management in 2020 increased from 35 percent to 46 percent; most crypto hedge funds trade BTC at 92 percent, followed by ETH at 67 percent, LTC at 34 percent, LINK at 30%, DOT at 28%, and AAVE at 27%; high net worth individuals account for 54% of crypto hedge fund investors and family offices at 30%.

In addition, Nobel laureate and economist Paul Krugman tweeted that he has abandoned his previous prediction that Bitcoin would die out, suggesting that Bitcoin could be seen as a faith (cult) that could survive indefinitely, though Paul Krugman still believes Bitcoin has no fundamentals. Paul Krugman says: I’ve given up on predicting the imminent demise of Bitcoin, because Bitcoin always seems to emerge with a new group of believers, and perhaps it can now be seen as a belief that can survive indefinitely. But bitcoin is not an innovation, nor is it a convenient means of trading and a stable store of value, and it’s certainly not a unit of account.

Will it continue to fall?
In the face of such a large drop, the end of the bull market is in full swing, and Glassnode data shows that the current bitcoin sell-off has taken a historic toll on short-term holders, with the STH-SOPR value, an indicator representing purchases of cryptocurrencies during the current bull cycle, falling to near 0.9, after having fallen below that position only three times since 2015, at the the start of the bear market in February 2018, the selloff in November 2018; and the sell-off triggered by the new crown pneumonia in March 2020.STH-SOPR takes into account the extent of profits realized by cryptocurrencies moving on-chain, filters out cryptocurrencies held for less than 155 days, and represents entities that have purchased cryptocurrencies in the current bull market cycle.

Bloomberg analyst John Authers also tweeted that (Bitcoin) fell 53% in 5 weeks and then rose 35% in 4 hours. There are two observations so far:1. No one will participate in bitcoin-denominated transactions. 2. It’s too early to say the bubble has burst (or that this is a new bull market).

It’s worth noting that as the decline intensifies, calls for bottom-buying are picking up.

On May 22, Synthetix founder KainWarwic tweeted that it is still a bull market, so take it easy.

Anthony Scaramucci, founder of SkyBridge Capital, said, I still don’t think the bull market in bitcoin is over yet. Most small retail investors are using leverage. We believe that over $8.6 billion in crypto assets were all liquidated yesterday and that bitcoin will rally in the long run.

On May 23rd, Wavefield TRON founder Sun Yuchen tweeted again that he has “bottomed out”. Previously, on May 20, Sun bought $153 million in bitcoin at an average price of $36,868 and $135 million in ethereum at an average price of $2,509. In addition, Sun Yuchen also tweeted: I personally think that the bull market is certainly not over yet, this decline belongs to a bull in the adjustment, June adjustment is over, July and August will certainly open a round of big bull market. Personal shallow opinion we do not as a financial investment advice.

On May 24, data showed that ARK Fund bought into the GRAYSCALE Bitcoin Trust. In addition, former BTCC (Bitcoin China) co-founder and CEO Bobby Lee said Monday that he doesn’t think bitcoin will continue to fall despite recent regulatory pressure, and reiterated his prediction that it will soar to $100,000 in the coming months. But Lee warned that after the current bull market, bitcoin could be in for a “severe winter” that could last for years.

Posted by:CoinYuppie,Reprinted with attribution to:
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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