Is the Bitcoin Selloff an Opportunity?

cryptopub | November 8, 2021

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Bitcoin tanked going into 2019, but reedeemed itself handsomely. Can it do it again?.

Just recently, it fell from a high of $10,600 to a current price of $5,300. 

Back in 2019, some pointed to a poor reception to the first Bitcoin futures contracts offered by the ICE Bakkt platform. In fact, the highly anticipated launch of those futures was quite disappointing with only $5.8 million BTC trading volume in the first week out. 

Granted, many saw Bakkt as a catalyst to get institutions on board.

But it didn’t generate much interest at all.

More recently, Bitcoin has plummeted on Covid-19 global pandemic fears. Once considered a possible safe haven, Bitcoin took a beating.

But it’s not just Bitcoin. Other safe haven investments including Gold have also taken a beating.

Coronoavirus fears look like its driving investors to the sidelines and they are staying in cash.

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BTC has become technically oversold, as investors panic.

But as they panic, they’re creating opportunity deep in oversold territory. For example, here’s a one-year chart of BTC. Not only is BTC oversold at its lower Bollinger Band (2,20), it’s also excessively oversold on relative strength (RSI) and Williams’ %R.

Notice what happens each time RSI dips under its 50-line, a Full STO dips to its 20-line, and below. Shortly after, BTC begins to pivot and turn higher. These indicators alone are telling us BTC is wildly oversold at current prices, and overdue for a turn higher.

These same indicators are great at calling tops, as well.

For example, notice what happens when BTC hits its upper Bollinger Band (2,20) with RSI nearing its 100-line, and with the Williams’ %R  above its -20 line. Not long after, we begin to see a pivot lower, as we’ve seen quite a few times.

With the latest move lower in BTC, keep an eye on it. Indicators say its very oversold.

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