Drop exceeds low in February
In February, the bitcoin (BTC) price suffered a severe drop from about $8,000 to the lower end of the $6,000 range. It bottomed out at around $6,050. However, today BTC’s price is down in the higher end of the $5,000 level the first time it has been this low since early last November.
From May 29 to June 10 there seemed to be a recovery taking place in the price of bitcoin and in many other cryptocurrencies with over a week of relative stability and consecutive gains. However, there was a sell-off on June 11 leading to a drop in the bitcoin price from $7,700 to $6,670. After a short term correction the price is plunging again.
Others had predicted this drop
A recent CoinDesk analysis had predicted that there would be a drop over the weekend based on technical analysis. Yesterday saw the price close still over $6,000 but so far today it has been a different story with the price well below that level.
Willy Woo, a cryptocurrency researcher and investor, in early May argued that due to the extreme volatility of the market and the low volumes in trading it was likely that BTC would see a slow slide to $5,500. The drop has been by big dips and then short recoveries but it appears it could reach the $5,500 level if not lower.
Where will the drop end?
Many traders see the price of bitcoin bottoming at around $5,000 but some see it as falling below even $5,000. However it seems unlikely that the market will not rebound at all or show no sign of recovery it seems unlikely that the price will end up bottoming below $5,000.
A drop from its all-time high of around $20,000 to $5,000 would mean that BTC had lost 75 percent of its value, and this would be a worse correction than the one in 2014. A recent article argues this is highly unlikely and that it will bottom out in the lower region of the $5,000 range. It is also optimistic about the future.
Where will the price of bitcoin go?
The article argues that investors in the public market will develop a strong interest in an asset or commodity if it drops 70 to 80 percent in the short term as it could lead to a viable buying opportunity. Mid to long-term traders aim for investment opportunities in the next year to two years.
Bitcoin’s price experienced the same type of movement in 2010 and 2014. Every correction has been followed by the bitcoin price rebounding beyond its previous all-time high and establishing new ones that are from 100 percent to 300 percent above the previous highs.
Another recent article also is optimistic and provides three reasons why the bitcoin price should rebound. The appended amusing video also provides an optimistic scenario. Of course it could turn out to be that the drops in price may convince some people it is time to cash out bitcoin or even sell it short.
The present situation
The price of bitcoin opened on June 24th above the $6,000 level at $6,170 and rose to a high of just $6,188 before it began to fall to as low as $5,785. However, just recently the price has jumped up to a new high of $6,241 well above its opening price. At 19:37 UTC it has dropped back a little to $6,184 but it still well above the $6,000 level. Perhaps the weekend will end with bitcoin already recovering but there are still over four hours to go. The present price of bitcoin can be found here.
