In the last 24 hours, another selloff has started in the cryptocurrency market which hasn’t come as a surprise if you read my yesterday’s analysis. The market is red with double-digit loses across the spectrum. Bitcoin Diamond, however, is by far the biggest loser among top 100 coins marking a decrease of 84% in the last 24 hours!
The price fell to $2.38 and judging by the momentum behind the red candle the decline isn’t stopping soon which is why in today’s analysis we are going to further inspect the potential price pathway of this cryptocurrency and try to conclude is there any hope for long-term holders of Bitcoin Diamond.
Note that in the bear market selling usually gets exaggerated but those cryptos that are down the most usually are the once that people are holding “just in case” which is why in this market we can use this information as a signal of faith in a particular crypto. Judging by the selling amount of Bitcoin Diamond it looks like people who held it after a fork were only one interested in this coin.
Looking at the BCD/USD daily chart we can see that the price action was mostly constrained inside a descending triangle since the coin hit the market.
This current down move landed on the triangle’s support after it has interacted with the triangle’s resistance which ended as a wick on the daily chart. This level served as support in the past but judging by the momentum of this massive red candle it probably won’t for much longer. It is reasonable to say that after this quick decline some short-term recovery will happen but those who missed on the selling will use that “better price” to start selling again which would push the price below the triangle’s support.
Looking at the 4-hour chart we can see that another minor WXY correction occurred and the wave Y has ended on the 0.618 Fibonacci extension level.
As the price of Bitcoin Diamond is lowest it has been ever I believe that now that the WXY correction has ended we are going to see some short term-recovery but yet another decline and finally bottoming out in form of a plateau.
Zooming into 2-hour chart I have projected the recovery wave to end on the prior range support retesting it and getting rejected before creating the final low and flattening out in a bottom like formation similar to a cup and handle bottom with low volatility.
The lowest the price could go is 0 so there isn’t much room from here for the price of Bitcoin Diamond and that leads me to believe that the majority of the selling is done.
Looking at the BCD/BTC daily chart we can see that the price action has already broken out off of the descending channel on a similar candle pattern.
That isn’t that much significant as this support line on the Bitcoin Diamond against Bitcoin chart wasn’t that respected in the past, but it shows that after the interaction the price bounces leaving a V shaper which is why I would expect to see something like that again before the price flattens out. I have labeled the last possible level at 0 with the red horizontal line which you can see isn’t that much far.
Bitcoin Diamond might never recover from this price wise because those who got it on the fork sold it early on and those who were will to hold it just in case are now finalizing their selling before the coin gets worthless.
This may create some speculative interest in the future, but potentially when BCD introduces some technological improvements which I highly doubt it would because many of these forks and projects are just a way for people to grab some quick money by pumping the perceived value through association with the Bitcoin “brand”.