Bitcoin [BTC] Price analysis: Bitcoin can fall to $ 8,500, is Reddit a new source of trading signals?
Bitcoin It is known for abrupt changes and retail traders. Experts comment that the lack or presence of strong regulations is a big blow for institutional grade investors such as pension funds, who know that bitcoin prices and cryptocurrencies in general are full of potential and could generate high dividends, but are susceptible to price manipulation considering their decentralized nature.
The role of regulators in the success of Bitcoin
However, the approval of Bitcoin and crypto-centric products depends on regulators. Most have shown their willingness to adopt the underlying technology, and are generally open minded. The main one is the SEC of the United States.
The regulator led by Jay Clayton is cautious and with comments from the US president. and recently, from the US Treasury secretary, Steven Mnuchin, a Bitcoin ETF is unlikely to be approved this year.
However, that will not prevent investors and traders from using unconventional means to determine possible price trends.
Trading signals on Reddit?
Recently, a ChartStar finding revealed that there is a direct correlation between the price of BTC and the search term «Bulls» on the popular social media platform Reddit.
His study found that the price of Bitcoin increases when the number of search terms increases «Bulls», correcting only when the number of this search term is exceeded. Commenting on this, David Gilbert of ChartStar said:
“There is an increase in optimism that exceeds the trend, followed by a fall in the price. This could indicate that excess optimism is a sign that the asset is overbought and is a potential warning that it must be corrected. ”
BTC / USD price analysis
To date, the price of BTC remains firm above the average BB but drops 7%. On the last day, the price remains neutral. Even so, the trend is steadily rising.
The fact that prices are also above support, the previous resistance level of $ 9,500, is a hint of buyers. In particular, it means that the new test is more complete, so prices would continue to rise, based on the bullish bar yesterday.
Ideally, aggressive operators can carry the falls as the trend is firm. However, judging by the arrangement of candles, the best course of action is to wait at higher levels above $ 10,000.
After that, and even more so if the rebound is behind the high trading volumes, traders can buy the dips and aim at the June 2019 highs of $ 13,800.
For now, patience is paramount. Prices are trending within the candlestick chart of bears on February 19 with light volumes. Any drop below $ 9,500 could trigger further price declines as BTC falls back to $ 8,500.
Graphic courtesy of Trading View-Coinbase
Disclaimer: The opinions expressed are those of the author and are not investment advice. Trade in any way implies risk. Do your research.