Bitcoin: Why This Boring Market May Be Very Bullish Long Term

After the vicious sell-off in Bitcoin mid-November, the prices of cryptocurrencies stabilized. Since then, over the course of the past 6 weeks, it is fair to say that Bitcoin and cryptocurrencies are a boring market. Now, this may be a very bullish setup long term for 2 reasons. Although our Bitcoin price forecast 2019 seems very far off, this boring market may help Bitcoin eventually reach our price target. Fundamentally, nothing has changed, and our 5 cryptocurrency predictions are fully intact.

As fundamentals in the crypto market has not changed, why is it that Bitcoin and crypto prices are not moving higher? Specifically, Bitcoin has been moving between 3250 and 4500 USD in the last 6 to 7 weeks.

Mind, though, that 1 of the following 2 scenarios may be playing out now. Bitcoin is now either trading sideways in a range between $3250 and $4500 OR it is setting another descending triangle pattern. We lack data at this point in time to know for sure that the new pattern on Bitcoin’s chart is a consolidation. It might be, we cannot know for sure at this point in time.

In case of a descending triangle, as drawn on the chart, it will have bearish implications for February and March.

However, in case of a continuation of this boring sideways Bitcoin price action, it might be very bullish long term. This is why.

First, chart-wise, we may see a consolidation starting to appear on Bitcoin’s daily chart. Agreed, it is boring price action short to medium term, but the process of consolidation drives sellers away from the market over time. It has to be clear that we are talking about sideways trading as a market condition.

Consolidations create a very bullish long term outlook for any asset or market. Essentially, during sideways trading, sellers tend to leave the market with every peak that is set. If a consolidation goes on for a long time there are hardly any sellers left. That’s the ideal market condition to create a new bullish trend. The general rule of thumb is ‘the higher the base the higher space’ which means that the longer a sideways consolidation period the more bullish power because there are less sellers in that market.

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