Bitcoin Price Dropped to Three-Week Low, Took Three Days to Recover
On June 15, bitcoin price fell to a three-week low amidst a major market correction and fears of an execution of a hard fork led by Chinese bitcoin mining equipment manufacturer and mining pool operator Bitmain.
After establishing a new all-time high at $3,092, bitcoin price declined to around $2,120. Despite falling to a three-week low, bitcoin price took three days to recover to the $2,500 region and it is currently sustaining an upward trend at $2,620.
Prominent bitcoin investors and traders including Tone Vays, Alan Silbert and Squeeze have all expressed their optimism toward the recent build up of bitcoin price and its momentum. Vays, who offers extensive technical price analysis on a daily basis, wrote:
“Weekly bitcoin/USD pair is on Week two of 1-4 week Pull-Back. Daily bitcoin charts just signaled a Buy & Hourly showing Cup & Handle breakout to $3,100.”
Squeeze and Silbert both noted that the next bump or surge in bitcoin price is imminent and that bitcoin price could reach a new all-time high in the short term.
Recent analysis of bitcoin price and its trend can be referred back to RT’s Max Keiser’s evaluation of bitcoin price development. On June 2, Keiser introduced a chart which demonstrated bitcoin’s price trend and recovery from various market corrections since 2009. The chart demonstrated bitcoin’s tendency to recover beyond the previous peak or all-time high after a major market correction.
For instance, when bitcoin price reached an all-time high at $2,700, it plummeted to the $1,900 region for a few days before recovering beyond the $2,700 mark and establishing a new all-time high price at $3,092.
In an interview, Greg Dwyer, business development manager at digital currency trading platform BitMEX, told Reuters that the recent fall in bitcoin price was likely caused by increasing concerns of investors and traders toward the possibility of the occurence of a hard fork.
The execution of a hard fork is not necessarily a negative activity in nature. Uncontentious hard forks can present benefits over a soft fork in that they can create major changes to a blockchain protocol in a more elegant and simpler manner. However, an issue occurs when the execution of a hard fork leads to two persistent blockchain networks and two independent tokens. The execution of a contentious hard fork on the bitcoin network could lead to two bitcoins, which traders, the industry, community and users are trying to avoid.
“Traders are concerned with what a fork could do to their holdings and most likely now converting to fiat (government currencies) until some clarity about the scaling debate comes to light,” said BitMEX’s Dwyer.
Overall, prominent bitcoin traders and analysts remain optimistic in regard to the recent development and upward momentum of bitcoin price. Some speculate that bitcoin price could soon reach a new all-time high if support levels are met.
Moreover, with more than 60 percent of hashrate signaling for the activation of the New York Agreement, it is likely that the community will be clarified on the possibility of a hard fork and scaling discussions. One key component of the New York Agreement is whether participating companies can cooperate and collaborate with Bitcoin Core developers to create safer and efficient code to scale the Bitcoin network with.
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