Here’s Why Analysts Are Bullish After Bitcoin Price’s Rapid 7% Plunge

Earlier Sunday, Bitcoin (BTC) suddenly fell off a cliff after its latest bout of bullish price action. Within a few minutes’ time — yes, literally a few minutes — the leading cryptocurrency slipped by 7%, plunging from $9,150 to $8,600 (as low as $8,450 on some crypto exchanges). Altcoins followed suit, posting equally as harrowing losses, with Ethereum and XRP tumbling 6% themselves.Related Reading: Research Firm: 3 Use Cases Could Send Bitcoin To $1 TrillionDespite this strong drop, which comes as BTC was trying to flip the key $9,000 psychological and technical resistance into a support level on a macro basis, analysts have remained bullish on Bitcoin. Here’s why.Bitcoin’s 6% Drop Is A Bullish Sign, Kinda Prominent cryptocurrency trader The Boot, who famously turned 0.6 Bitcoin into millions of dollars worth of the cryptocurrency in just over a year, noted that the selling volume seen after the 6% drop seemed “low AF.”With this in mind, the trader asserted that it may be wise to “scale into buying the dip until proven wrong,” further explaining that a bearish setup, constituting a lower high and breaking support, has yet to form on the short-term charts.sell volume after that 5m candle is low af. Imo – scale into buying the dip until proven wrong (via making a lower high and then breaking support established in between)— TheBoot (@TheBootMex) January 19, 2020Related Reading: Watch Out, This New Bitcoin Scam Is All Over YoutubeAn analyst going by Thrillmex echoed this optimism, posting a tweet in the wake of the dramatic collapse. He showed in his tweet the BTC quickly wicked higher on the four-hour chart after briefly tapping the key supports at $8,463 and $8,577, implying something of a swing failure pattern or a “long liquidity hunt.”While this long bottom wick isn’t indicative of a reversal, the fact that BTC managed to close the candle above the aforementioned supports shows that not all hope is lost for bulls.Similarly, another trader pointed out that while the 200-day moving average was lost in this drop, the 9-day moving average has decisively held. This is important as Bitcoin has ridden the nine-day moving average higher over the past 10 days.The fact that it is trying to hold this level could suggest that this drop is just a short-term correction before another push higher towards the $10,000s.$BTC— Jonny Moe (@JonnyMoeTrades) January 19, 2020Related Reading: Crypto Tidbits: Elon Musk Pokes Bitcoin Bear, Japanese Giants Delve Into Cryptocurrency Mining, Baidu’s Blockchain BetaFeatured Image from Shutterstock

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