Bitcoin, the largest cryptocurrency, could be on the cusp of another major price rally if history is any guide
Alan Farley, a private trader and frequent CNBC contributor, has an observation that could give the beleaguered Bitcoin bulls a ray of hope.
The last time it was this heavily oversold, the largest cryptocurrency rose more than 500% in just five months during the first half of 2022.
At the time, Bitcoin was emerging from the brutal crypto winter of 2018. However, it is possible that the current crisis will be different from previous bear markets due to the scale of the losses, media coverage and regulatory scrutiny. .
Yet, past data shows that investors have made significant gains by buying Bitcoin at oversold levels. The flagship cryptocurrency is considered oversold when the Relative Strength Index (RSI), a popular momentum indicator, drops below 30.
As reported by U.Today, Bitcoin bull Mike Novogratz recently predicted that Bitcoin would be able to come back from this crisis. However, smaller projects with little utility are unlikely to weather this crisis, the crypto mogul said.
Novogratz’s long-term forecast is $500,000 per bitcoin. The billionaire is convinced that this objective potentially be reached five years from now.
Meanwhile, Wall Street’s superstar stock picker Cathie Wood recently doubled down on her company’s overly optimistic call that the price of Bitcoin could hit $1 million by the end of this decade.
Bitcoin would need to rise 5,949% from its current level to reach this price target.