Bitcoin price is now above $40,000, more than 20% from the lows set in late January. Despite the rally, the common sentiment in the crypto community, analysts, and more is that the bottom is nowhere near.
Meanwhile, BTCUSD has started its recent bounce from a seven-year secular uptrend line. Could that combined fact of how few expect a bottom be the best case for why one might already be in?
Contrary Opinion: Crypto Market Sentiment Would Be Blind to a Bottom
In the blink of an eye, Bitcoin has risen back above $40,000, still well below the $100,000 by the end of 2021 that the crypto community, analysts, mathematical models, and more had been projecting.
The current collective expectation of that same crowd is that the current rally is nothing more than a “bull trap” and a return to $30,000 and even lower is all but guaranteed.
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Often when the consensus expects one direction, the market moves in the opposite direction. With market participants convinced that the downtrend will continue, the current bounce could leave many behind.
Especially when the bounce itself started at a seven-year secular uptrend line, and a trend line that put down two bear market bottoms.
A look at the seven-year secular uptrend line | Source: BTCUSD on TradingView.com
The Bitcoin Trend Line That Just Won’t Stay Broken
The chart above shows what the nearly decade long trend line looks like. The trend line first started at the 2014-2015 bear market low and was only temporarily lost during that time frame. After moving around for almost two full years, the price of Bitcoin went parabolic and surged from around $2,500 to $20,000 in a matter of months.
The top cryptocurrency by market cap spent the entire bear market above the trend line, only touching it again in December 2018 to hit the bottom of the most recent bear market. Like the 2014-2015 bear market, the line was briefly lost again during the current cycle during the Black Thursday market crash.
Claiming the trend line is what caused fireworks in late 2020 and early 2021, and Bitcoin has been swinging ever since. Only now, after an unexpected downtrend back to $30,000, has the cryptocurrency touched the trend line in question since the end of 2020.
Related Reading | 2022: The Year Bitcoin’s Secular Bull Run Could End
A rebound begins, but very few expect this to be the bottom. But why not? Bitcoin has bottomed more times at this trend line than any other. In December 2018, the common theory was that the downtrend would continue and few expected it to bottom out when it did.
In hindsight, that was indeed the bottom of the last bear market. Could this fund be another example of one that is only done in hindsight?
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Featured Image from iStockPhoto, Charts from TradingView.com
This post Bitcoin Starting to Bounce from 7-Year Uptrend Line – Is This the Bottom?
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