Bitcoin (BTC) has been indecisive for quite some time now as bulls and bears both seem to have backed out of the fight. Meanwhile, coins like Ripple (XRP) and Stellar (XLM) have made impressive gains as investors have been waiting to jump on board at such low prices. This excitement has resulted in exuberant rallies over the last few days. Ripple (XRP) is up 6% in the last 24 hours whereas Stellar Lumens (XLM) is up twice the size at more than 10% in the last 24 hours! Coins like Stellar have seen rapid price boosts in the past few days as investors were seen very eager to pick up at the bottom. The price of Stellar (XLM particularly is up almost one third its value at ATH during early 2018. This is an interesting development when you realize that Bitcoin (BTC) is still not in the clear and things could take a turn for another short term fall in the coming days.
As always, we will see those spectacular gains reversed if BTC drops further, which seems very likely from the charts. Bitcoin (BTC) price is currently trading within a rising wedge. Strong bullish momentum is slowly fading in anticipation of another drop which could result in Bitcoin (BTC) falling out of the wedge to settle close to or below $6000. It should be noted that the further ahead Bitcoin price decides to trade in the red rising wedge, the deeper the price will have to fall to test the previous downtrend line.
Bitcoin (BTC) is also forming a series of rising wedges within rising wedges which signal a near term price drop possibly by the end of the week. If the fall results in Bitcoin bouncing off the red line of the bigger wedge, this could result in a new bull run next week which will trigger further altcoin rallies at least for short term. Bitcoin could continue to trade within the wedge at least for one more week and meanwhile popular coins will continue to have rallies based on positive news and general excitement. It should also be noted that this period of sideways movement could extend all the way to late May before Bitcoin eventually picks up and starts another rally.
Some analysts believe that we are yet to see the anger phase of the market where investors will believe that the price is not making headway and might give up which could trigger some selling below $6000 but the price will most likely stay above $5000. This could be the final push Bitcoin needs to take off and mark new highs for the year. Q2 has historically been unfavorable for the price of Bitcoin so do not be surprised if any more bad news or ‘FUD’ drives the price further down to settle around $5000s. Such a development will also turn most bears into bulls as they are convinced that the bottom has been reached and the next market cycle is about to begin.