The cryptocurrency market has been making some noise recently thanks to some positive new developments. Last week, China’s Xi Jinping stated that the country should focus on the future of blockchain technology, which bumped the coin up from its sideways movement. And more recently the Ontario Securities Commission (OSC) stated that it would list The Bitcoin Fund on Canada’s stock exchange.
These news stories have breathed life once again into bitcoin and significantly boosted its price. But now analysts are thinking that the coin might be overbought, which could mean that it’s due for a reversal down to more realistic levels.
A popular cryptocurrency analyst on Twitter has revealed what he believes is bitcoin’s ideal price point. The analyst, called Dave the Wave, stated that the ideal buying price for bitcoin is near the $6700 level, which would mean that the coin’s current price of $9200 is considerably overbought.
Histogram contracting on the daily, MACD rolling over, medium trend still down… but not for long. pic.twitter.com/cuIcsTvHVw
— dave the wave (@davthewave) November 1, 2019
Dave the Wave notes that the coin is in a downwards trend over the medium term and that the MACD histogram, which measures momentum, is also showing bearish qualities.
Dave the Wave states:
“Is the IDEAL buying price of 6.7K still a real possibility? Yes, but in practical terms I think you’d be buy in tranches/ average in once price hits the ‘buy zone’. Sailing close to the wind now….”
There is some additional evidence to give credence to the analysts claims. By using a volume profile indicator, which shows the level of demand of particular price points, the greatest concentration can be found near the $6500 area.
The logarithmic chart for bitcoin also affirms that bitcoin could be overbought. The chart with curved trendline shows that the support level is at $6300 and is slowly curving upwards. It’s therefore likely that the ideal price point for bitcoin is at or near the $6700 mark.
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