I managed to catch a screenshot of Bitcoin right after it crashed through the $4,000 mark.
At that time it was down over $3,718, about 48% on the day.
Buyers then stepped in pushing the price back over $5,000, a rebound of over $1,000 in a matter of minutes.
Technically Speaking
Technically speaking Bitcoin has a very broken chart.
The charts did not show support at $4,000 but I won’t argue with them. That is the new support level to watch.
Below $4,000, the next support is at the previous low of $3228 or so. If that fails, then I am watching the $1975 area then $995. Ouch!
Price vs Hash Rate
Once again I point out the widely believed nonsense that price follows hash rate.
Hash Rate Hits Record
Please consider this January 2, 2020 post Bitcoin Kicks Off 2020 More Secure Than Ever as Hash Rate Hits Record
Bitcoin Hash Rate
Bitcoin vs Hash Rate
So we are near record highs on the hash rate.
Bitcoin peaked at $19,783 on December 17, 2017.
Bitcoin broke through the $4,000 level today.
So, please stop the nonsense that Bitcoin follows the hash rate. Clearly it doesn’t.
Hash Rate Projections
Belief in the hash rate is likely what’s behind the $1,000,000 projections.
Since people still believe in the million dollar projections they are forced to believe in proven nonsensical hash rate theories.
Misunderstanding Supply
The fundamental issue behind both projections and hash rate theories is a huge misunderstanding of supply.
Contrary to popular myth, the supply of bitcoin rises every day albeit at a diminishing rate.
Break in Faith
https://twitter.com/TheCryptoDog/status/1238267603996405761
Question of the Day
Liquidity Moment
Bitcoin just had a liquidity moment.
Perhaps it is related to liquidity issues and selling as discussed in Bond Market Dislocation: What the Hell is Going On?
There is every reason to believe Bitcoin has more liquidity moments ahead of it.
Mike “Mish” Shedlock
Bitcoin and other crypos are nothing more than fiat currencies for geeks and the gullible.
I have to laugh reading this post. Look at gold and the miners – they are getting crushed every single day. Gold will retest $1200 soon.
Would suck if Trump invokes emergency measures which give him complete control over the net and declare btc a nuisance that must be dealt with that’s enhancing the crash.
Sure, $4,000 why not…its actually up to $5,900 rignt now (Friday early morning) so who knows! One thing for sure some early investors may have needed liquidity — market clearing for large volumes of Bitcoins may be tricky! Facts are you sell what you can.
But assuming “support levels” for Bitcoins is hard to justify under any light. But as you say, $4,000 “why not!”
Thanks to GREGGG for these two very informative videos.
I wonder if it will end up being worth more than paper with dead presidents on them.
I guess at least the paper can heat something.
With paper dollars, if the electricity goes out, at least you have a part of history.
When you stop and think about the amount of energy and time taken to mine Bitcoin it’s pretty crazy. So much hardware dedicated to pointless “work”. Since most crypto enthusiasts I know are concerned about it, I wonder if they consider how much CO2 has been produced to generate their “store of value”
I argued with a guy at a bar about this 2 weeks ago. He sounded totally “invested” and I bet he’s sunk more beer bottles than dollars in his investment.
There’s firm support at zero.
TSA agents demand bag-search to look for “Bitcoins”.https://www.businessinsider.com/bitcoin-tsa-screening-2014-2?op=1
There will always be some value to sentimental collectors who keep a few around on the display shelf or cabinet, in order to be able to pull them out and pass them around, reminiscing about the Bitcoin Heyday.
……oh, wait
The chart from Investing.Com had terribly wrong one day percentages.
I notified them and dropped the percentage decline from the charts in this post and the previous.