To cryptocurrency enthusiasts, this might come as a welcome hypothesis—with Bitcoin hitting a 50-day low today at $6,630 USD—though Godbole indicates that it’s probably going to get worse before it gets better, speculating that BTC will fall in the $6,600-$6,000 range over the weekend.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
The evidence from market analysis? According to Godbole:
BTC tends to reverse course every time the relative strength index (RSI) drops to or below 30.00, according to historical data…. As of writing, the relative strength index is close to that mark, at 32.00.
Disclosure: I own some Bitcoin.
This report also follows a recent tweet from Digital Currency Group Founder Barry Silbert, in which he indicated that part of the renewed bear cycle stems from a sell-off related to tax season.
As you can see from the graph below, Bitcoin has seen a significant drop over the past week, seeing more than a 25 percent drop from 7-day high of $8995.50, according to CoinMarketCap.
The price of Bitcoin at the time of this writing is $7,047.19, up over $400 since the morning low.
Editor’s Note & Disclosure: The author invests in cryptocurrency markets. Neither the author nor Forbes endorses participation in any token sale or cryptocurrency investment, all of which have significant inherent risk. Seek advice from a financial advisor as well as do your own due diligence before considering investment.