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Get Ready To Long The Bitcoin Bounce With PrimeXBT

Bitcoin price is now trading in the low $30,000 range, more than halfway down from the all-time highs set just a couple months prior. But with sentiment at extremes and completely in the gutter, it could be time for a reversal in the crypto market that reignites volatility for a short while.

Any bounce from current levels will be a testament to if the bull market is still on, or if a bear market has started in Bitcoin. Here’s how to get ready to long the bounce with the award-winning PrimeXBT cryptocurrency trading platform.

What Goes Up Must Come Down

Although most crypto market participants are licking their wounds wondering what caused the selloff in the first place, technical analysis suggested the selloff and great reset of 2021 was coming. But just as markets turned down when everyone was full blown bullish, now that sentiment has switched so bearish, a reversal back to highs could soon arrive.

When greed was at its highest, Coinbase Global was going public and the “new paradigm” narrative started to be believed. But the exuberance itself is what caught bulls so off guard and what led to such a sizable collapse.

However, just like Black Thursday and the bear market bottom, Bitcoin will hit a bottom eventually and when it does, it could very well rocket back toward new highs if the bull market structure is still intact. For now, watching for a bounce will determine what happens next.

Why A Bounce In Bitcoin Could Soon Be Coming

Much like technical indicators were severely overheard and screaming of a top of the crypto rally back in April, similar indicators are now suggesting a bottom is in. Whether or not this is a short-term bottom before new lows or the final destination before the bull run is back on remains to be seen.

If Bitcoin recovers from support but falls to new lows, it is considered a “dead cat bounce.” Recovering above $64,000 and setting a new all-time high would invalidate any bearish market structure and give bulls confidence to push the price per BTC even higher over the remainder of 2021.

If the first fall from the short-term top behaves the same way as it did in 2019, a large pump could follow but fail to reclaim highs. The lowest Bitcoin price should go to keep the bull market alive is below $14,000. Anything below that level is a full on bear market, and it could last a long time due to Bitcoin failing to reach expectations.

With a bounce potentially on the way, it should now be time to begin scaling into a long position, and setting stop losses below according to the chosen risk management strategy and risk to reward ratio.

What If The Crypto Trade Is Far Too Crowded?

Analysts, traders, speculators, and everyday “average Joe’s” all expect Bitcoin to reach hundreds of thousands per coin this year, and continue to hold no matter what. But could that price target fail, and end up being a curse instead?

If the entire market expects the price action to move a certain way, a contrarian position is often the most profitable. The proof was in the April 2021 peak, which resulted in the worst monthly selloff on record to follow with a 50% collapse.

Sentiment might be bearish enough for a bounce and retest of highs, but if everyone is this bullish on Bitcoin in general, is a more violent bear phase necessary to cause capitulation to set in? If so, shorting Bitcoin would be the better option, but who truly knows?

Only Time Will Tell, Be Prepared For Anything

Crypto enthusiasts expect “long the dip” season to still be in full effect, but that could prove dangerous. Traders who are ready for anything with hedge shorts and the right long entry and stop loss set, could result in unprecedented success when Bitcoin starts to move once again.

The long would keep the trader profitable while the hedge short got stopped out at a meager loss. Should Bitcoin fall instead, the hedge short would protect the USD value of any BTC holdings at stake or used as margin. Using PrimeXBT’s built-in charting software and advanced trading tools, traders can be prepared for whatever is to come.

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