Bitcoin: Catching a Falling Knife?

Over the last day or two, bitcoin price dropped from above $10 000 to below $8 800; that is a substantial decline of over 22%. That is quite scary. However, there have been similarly scary moments in recent months. Generally, these scary pull backs in bitcoin price lead to a re-test of the levels of the previous highs. The previous high is at the level just below $8000 (see chart below).

A similar scary decline happened in November 2017, when bitcoin dropped from $8000 to under $5500. That time, the previous high was at the level of $5000 (see chart below).

Yet, another similar drop took place in September, when bitcoin price decreased from $5000 to $3000. And again, the previous high at that time was at $3000 (see chart below).

It means that bitcoin price is likely to re-test the previous highs again at $8000 (or just below that). After re-testing the previous high, bitcoin will probably be stuck in a range around $10 000 for a while. This is because apparently a lot of new investors in bitcoin are having losses, which discourages any additional inflow of capital. In the longer term, near the middle of 2018, bitcoin should re-test the all-time-high :) Let's hope for that.

Do you disagree about a re-test of the all-time-high? Do you think that the bitcoin bubble has burst, and it is going down to $1000? Let's have a small contest, where you guess the bitcoin price on 11th of Feb 2018, 11am UTC time. The closest number will receive a transfer of 1 SBD from me (myfinanceteacher). The guesses are not accepted after this post will have been paid out on 9th of Feb.

To participate:
(1) Comment with bitcoin price on 11th Feb;
(2) Upvote this post;
(3) Follow me;
(4) Resteem
(5) All of the above done before 9th of Feb.