Bitcoin’s price is circling around $6,500 after a week of struggling to establish a higher position. Like it was this entire month, the market is still dominated by sellers and low interest in trading the cryptocurrency, which couldn’t be said for the start of the year when Bitcoin was the buzz word of the crypto and financial sectors. According to CNBC, this suggests that Bitcoin may finally be bottoming out and preparing for a significant price boost over the long-term.
As the news network explains, although Bitcoin has been quite volatile over the past months its annualized volatility is only around 60%, as opposed to last year’s volatility which was over a staggering 150%. Since the volatility has depressed and Bitcoin lost much of the value brought by last year’s hype, analysts for the media portal suggest that the cryptocurrency is ready to bottom out. Namely, as the “craze” is coming to an end and Bitcoin’s price and volatility are normalizing, it may be time for the cryptocurrency to start recovering over the long-term.
Market Still Bearish
Looking back at the price movements since our last update on Wednesday, Bitcoin’s value has remained virtually unchanged as the market still hasn’t maintained a single direction. The lowest price reached during this time was in the early morning hours on Thursday, when Bitcoin dropped to $6,345.54, while the highest price point was hit yesterday afternoon when the cryptocurrency reached a value of $6,811.99.
One thing worth noting during this period is that the 24-volume dropped even lower than usual, reaching even $3.3 billion during the weekend. But things are looking better since this morning as the trading volume has climbed over $4.1 billion and is once again rising slowly. The market cap is likewise up from last week and is currently at $113.7 billion.
Our technical analysis shows that the market is currently dominated by bears, with 10 out of 12 oscillators and 7 out of 12 moving averages being in the red zone, signaling a selling trend. The SMA 100 is still below the long-term SMA 200, showing us that there is less resistance on the downward path. As the price was rejected by the $6,900 resistance but failed to break below its $6,500 support, we might be looking at a short term range between these points. For a longer-term direction, the price should bottom out if the $6,000 level holds.
Over $30 Million Stolen from South Korean Exchanges Last Week
Bitcoin’s selling trend may be, to some extent, also influenced by news of two major cryptocurrency thefts during the past 7 days. As reported by CNN Money, one of the largest South Korean exchanges, Bithumb, has issued a notice to users to inform them that all withdrawals and deposits have been stopped due to a theft of over $30 million in cryptocurrencies.
The exchange is reportedly investigating the theft and has informed users that it will be compensating them from its personal funds if the need arises, but also that their assets are secure in the exchange’s cold wallet storage. This news comes only a week after a different South Korean exchange Coinrail was reportedly hacked and lost around 30% of its cryptocurrency assets.
According to market data, Bithumb is the world’s sixth cryptocurrency exchange by trading volume and news of its hack slashed 2% from Bitcoin’s price. Bithumb’s hack is only one of several major exchange hacks that happened this year, the first being the heist of Coincheck – a Japanese exchange which lost $500 million worth of cryptocurrencies in January.