The crypto market had its worst day of the month on November 26th, with even Bitcoin experiencing a sharp cut.
However, this Black Friday is unlikely to have any long-term effects. Of course, this assumes that the king-coin can retain its position above specified thresholds. These indications will also serve as early caution signs of a bearish trend.
Black Friday and Bitcoin
Even though Bitcoin turned red yesterday after a week of consolidation, there is a potential that it may rebound quickly from its 8.1 percent cut. However, in the case of a short-term positive scenario, Bitcoin must not cross specific thresholds.
Bitcoin must first retest the bull market’s support band. With BTC trading at $54k, any retest from the band will just push BTC higher again, according to the short-term holding cost basis chart.
Second, the Spent Output Profit Ratio line has just bounced off the 1.0 neutral line, indicating that investors are resisting the temptation to sell into losses. This retest was eagerly anticipated, as a retest of the neutral line by SOPR in a bull market indicates rather stable performance.
In a bear market, if 1.0 is tested as resistance, it indicates that the market is no longer losing money. In this instance, staying over 1.0 is required for the time being.
Third, the supply shock ratio is currently exhibiting a bullish divergence, similar to what was seen in August and September. The reason for this is that illiquid companies with little or no history of selling are displacing liquid and highly liquid entities as a source of supply.
Despite plunging and almost generating a bearish divergence, Bitcoin has survived this time. We will witness a negative divergence if the price movement drops below the illiquid supply shock ratio signal, which should not happen if the incline remains stable.
So, if you’re seeking a short-term bull market, you’ll need to pay attention to the aforementioned signals. Investors might expect a speedy rebound as long as the Bitcoin market avoids a negative divergence and/or SOPR falls below 1.
Many people, especially cryptocurrency investors, are likely to be concerned about the slowdown in the advancement of the main cryptocurrency, Bitcoin.
One of Bitcoin’s distinguishing characteristics is its capacity to remain relevant for more than a decade despite its founder’s anonymity.
Bitcoin is the world’s largest and most popular cryptocurrency, with the largest number of investors. Bitcoin has earned investors’ trust over the years by providing extremely strong security.
The crypto market, as well as Bitcoin, was hammered on November 26th of this year. Bitcoin, the king coin, is thankfully on the mend.