Bitcoin bounced back over $10,000 yesterday in a sign that the bull market is not to be cowed, with alts refusing to be left behind and joining in the recovery. To paraphrase a well-known song, there had been panic in the streets of London and elsewhere this week as the Bitcoin price dropped as low as $9,475 before rocketing back up to tip $10,290 yesterday, while alts staged a similarly dramatic recovery, with ETH in particular showing huge strength and reminding us that this is not just the Bitcoin show.
Bear Market PTSD Hits Again
Bitcoin’s dip had many suffering the effects of bear market PTSD and seemingly forgetting that we are in the new market cycle. This led to some predicting a Bitcoin price in the low $9,000s or below, before we had even left the pitchfork that has been in evidence throughout 2020:
hey all – after my deep red sunday i just got my $BTC short still open. was about 1% away from getting filled. daily looks like we got more room. first sweet spot for long is 9100 with 200MA daily and 61.8 fib. 8500-8700 if we really would get there, i would try to swing long. pic.twitter.com/eLL8FUvsir
— LastLaughingGuy (@guy_laughing) February 17, 2020
In fact, Bitcoin bounced before it hit the bottom of the pitchfork, regaining the middle of the upward channel once more:
Because of this we can see no other option for the foreseeable future than for the Bitcoin price to continue its upward momentum, buoyed by the fact it has also now completed a golden cross:
The last 2 times this happened:
23rd April 2019: price went from $5388 to a high of $12,920 2 months later, a rise of 139%.
28th October 2015: price went from $295 to a high of $19,187 a year later, a rise of 6400% pic.twitter.com/eRCRJd8kTK
— Justin Waite (@SharePickers) February 19, 2020
This is made even clearer using the Super Guppy indicator which shows exactly what usually happens after the golden cross is completed:
Alts Enjoy the Party
With everything pointing bullish for Bitcoin, how have alts fared? ETH led the way with a storming recovery, rising by 14% to retake the $280 range it had occupied last week before the collapse. Most other big and mid-cap alts followed suit, with XTZ and ICX in particular gaining well. Like Bitcoin, this rebound should usher in a continuation in the overall market trend, with Bitcoin and the top alts moving in tandem for a while longer.
However, alts holders should be wary of Bitcoin dominance, which had a mini resurgence during the recent dip, jumping from 62% to 65.6% in five days, settling around the 63.8% area. This is not necessarily bad news for alts holders at the moment as alts are generally keeping pace with Bitcoin if not outpacing it, but if the Bitcoin dominance continues to move upward then that is symbolic that a Bitcoin run may be on the cards.
We would not expect Bitcoin to take over and outstrip alts until it has passed at least the $14,000 mark and perhaps not even until it surpasses its all time highs of $20,000, meaning alts should have plenty of room to grow until then.