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After negotiating so far in a triangle formation for the second half of 2019, the price of Bitcoin finally collapsed into a violent plunge that eliminated up to 15% of Bitcoin's value.
While the decline has turned many bulls into bears and caused a wave of fear and panic in the market, according to a leading cryptography analyst, it could be the final test of support before the price of Bitcoin does not go into bullish mode.
The two-year moving average of the Bitcoin price will confirm the bull or the bear
The fall of yesterday in the bitcoin markets has pushed the price of cryptographic assets from the high range of 9,000 USD to 7,800 USD on some cryptographic exchanges. The decline has allowed the Bitcoin price to test its 200-day moving average, where it currently rests in support.
Related reading | Inverse bitcoin price chart down for bear market
The helpline is important and will answer the question of whether Bitcoin is in a bull market or whether there is a chance that the bear market will come back with a vengeance. Throughout the bullish run from 2016 to 2017, Bitcoin tested the moving average several times without ever falling below.
3 / * IF * we are at this level, it would also align with a new two-year moving average test, which I had previously tweeted. This is an old graphic that shows that the test has been repeated in previous cycles. pic.twitter.com/RYryOGtOYd
– Philip Swift (@PositiveCrypto) September 25, 2019
Crypto-analysis analyst Philip Swift estimates that, if the 200DMA yields, there is yet another significant moving average that could be tested and used as a "final test before going into gear." The analyst cites the two-year moving average as critical. support that has been retested only once as a result of the setting of the bottom, unlike the 200DMA which has been tested repeatedly as support.
Swift says the moving average is on the Fibonacci retracement level of 0.618 – a system commonly used to predict where an accident is likely to reverse. The analyst expects the major market-cap encryption asset to rebound to the two-year moving average in what he suspects to be the final test before the uptrend begins.
He also concludes that Bitcoin is already "clearly" in a "bull market" and has shared a Bitcoin price chart with Puell's multiple added to back up his theory of what it might be in his current bearish cycle.
5 / … because we are clearly in a bull market. Several graphs, including Puell Multiple, indicate approximately where we are in the cycle (A, B, C on the graph).
It's as if it was the last test before going to the bull, so keep everyone! ? pic.twitter.com/5oHaLsibGU
– Philip Swift (@PositiveCrypto) September 25, 2019
According to the Puell Multiple, Bitcoin is probably in the first phase of real retreat and new compilation of its next uptrend. This phase is one in which even the most stoic hands of crypto holders are tested and potentially shaken from their long-term positions, as the fear that the bottom has not been defined actually enters the market.
Related reading | Bitcoin Price Based on the 2016 Bull Market Reactivation Model
If it's really the last test to be done before Bitcoin starts its upward run, buying the soaking solution would be a wise and profitable decision. But if the price in Bitcoin remains below its critical moving averages, the chances that the fund is not really rising start to increase.
Selected image of Shutterstock
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