In this article, we will discuss similarities and differences of the Bitcoin price 2017 and Bitcoin price in 2019.
Lets get started!
Since Bitcoin (BTC) has gained some 46% during the last month, the talk about the new bull run has been ever present in the crypto community. Many investors hail the possibility of repeating 2019, which was the biggest and steepest rally in the history of all investments. But is 2019 so similar to that fairy tale or we have just been drawn to believe that a new all-time high (ATH) is on the way just for our hopes to be crushed down in flames?
We are going to try to provide the answer by firstly analyzing each period technically and fundamentally and then compare them.
Bitcoin Price 2017
2017 was the first year of serious expansion of cryptocurrencies as investments. Investors all over the world started to take more serious notice of the upcoming assets and businesses related to cryptocurrencies started popping up like mushrooms after the rain. Therefore, first, let’s take a look at the fundamental analysis (FA) of Bitcoin inside that timeframe.
Fundamental analysis - BTC price 2017
As stated, the market was just started expanding with some of the most notable players entering the market. Binance launched an exchange, ICOs started booming, and the first influencers were being born. All that was lead by BTC and its rise to $1,000.
When something is worth $1,000, it screams for attention no matter of the scarcity of the asset, and Bitcoin definitely is the one to thank for crypto entering the mainstream. The stories of pizzas being bought some years ago with thousands of BTC began circling around and all that tickled the imagination of the average retail investors because “Look at this thing! I could get rich quickly with Bitcoin!”
Bitcoin FOMO 2017
So, the investment frenzy started out of the pure FOMO (Fear Of Missing Out) as investors started swarming in towards the second half of the year despite the Bitcoin Cash hard fork splitting Bitcoin into two in August. Of course, FOMO created more FOMO as the first wave of 2017 investors really scored some significant profits. We still remember one YouTube blogger/crypto influencer, when BTC was around $5,000 in October 2017, stating that “you will never be able to buy Bitcoin at that price again!”
Obviously, he (and many others) was wrong, but the second wave of FOMO kicked in hard and, inspired by such bold claims made by “experts”, investments kept piling in.
It was late 2017 when we started hearing stories that BTC ETFs (Exchange Traded Funds) and similar trading products could be approved by the US SEC (Securities and Exchange Commission), which could push the new ATH way above $20,000.
What ICO did for the crypto market
However, what everybody kept forgetting is that there were literally thousands of projects entering the market while the biggest bull run in the history made even the mainstream media scratch their heads in disbelief. All these ICOs funded by individual investors were not what everybody has expected, and a big percentage of them were outright scams which left investors burned. Consequently, the overall level of trust towards cryptocurrencies began decreasing as the cryptocurrencies market struggled to self-regulate.
Moreover, some of the earliest adopters, more than satisfied with their enormous gains, began dumping their coins towards the end of the year, leaving the market with fewer buyers than sellers. In that time, regulations were frowned upon as they started coming. Also, some of the biggest centralized cryptocurrency exchange hacks deprived investors of their funds.
Combining all these market conditions, we got the fertile ground for a year-long bear market we witnessed throughout 2018.
But was Bitcoin really so overbought?
Technical analysis - BTC Price 2017
The first fiscal quarter of 2017 shows us that BTC was not really overbought.
Neither Bollinger bands indicator, nor the RSI and MACD do not show the mass hysteria it is about to follow. After reaching $1,180, Bitcoin retraced heavily towards $750, which was a sign of the insecurity. However, as can be seen in the daily BTC/USD chart above, every retracement was seen as a perfect buying opportunity by investors as the bulls pushed the price up towards $1,300 in a month and a half long buying wave.
Again, the chart doesn’t really show that during that time BTC was really heavily overbought except for a few minor outbursts in the late February and early March. Still, Bitcoin experienced a big sell-off to once again find itself under the mark of $1,000.
Looking at the chart, we can conclude that BTC was mainly following the horizontal movement if there is such a thing in this highly volatile cryptocurrency market.
The second fiscal quarter was the first that year where we could spot a serious divergence between the RSI (the declining red line) and the price movement (the ascending green line). Moreover, the mentioned divergence was closed by the MACD death cross, announcing the beginning of the reversal which brought the price down below $2,000 again.
However, all those things mentioned in the FA made BTC grow again, so let’s see how that happened.
To explain what was really happening, in the chart above, we are bringing in the volume indicator. So, BTC, after another overbuying session which carried it towards the $5,000, retraced, but, fueled by the already mentioned FOMO, the $3,000 support proved to be too tempting for the most buyers. Therefore, at that higher low, the buying volume simply exploded, inspiring a new wave of trust.
The renewed FOMO carried through into the fourth fiscal quarter.
The last quarter of 2017 was pure insanity with uncritical buying as the overall market capitalization skyrocketed above $800 billion. BTC was almost exclusively in the overbought range (visible in both the RSI and Bollinger bands) throughout the quarter which, once again, ended up with a huge divergence between the RSI reading and the price movement in December.
Through the previously unseen bull run, on Coinbase, BTC managed to reach $19, 870. What happened afterward is a well-known fact for the majority of the investors.
Bitcoin Price 2019
Two years since the Bitcoin’s ATH, the price dropped heavily towards the $3,100 mark (remember that influencer from the beginning of the article?), and the cryptocurrency which was still outclassing every other digital asset has found some support. Now, since we are already halfway through the year and BTC has definitely recovered from the 2018 bears, let’s see if we can have a similar phenomenon as we have witnessed before.
Fundamental Analysis - BTC Price 2019
We continue with some Bitcoin fundamental analysis for 2019. Cryptocurrencies are not such obscure financial assets anymore and Bitcoin is being mentioned in all the mainstream media. However, our expectations about BTC being “approved” by the US SEC, sadly, have yet to be fulfilled.
While that may be a problem for some investors, it brings hope because it makes it obvious that the biggest cryptocurrency still has a lot of room to grow and markets to conquer. However, the world’s biggest financial market’s financial watchdog’s hesitation to acknowledge Bitcoin clearly shows that the financial establishment doesn’t look kindly on the financial decentralization, and that will present the problem for the expansion of BTC in the future for sure.
Regulations have been slowly accepted by the crypto community since people realized that exactly those regulations can protect them from falling victim to those already mentioned scams. Considering regulations, many of the countries in the first world have regulated cryptocurrencies and some have also produced legal wireframes as a fertile ground for the crypto-related businesses, such as France, Switzerland, Malta, Germany, etc.
Bitcoin price recovery in 2019
All these facts made people consider investing in cryptocurrencies again, and, therefore, the market started to recuperate. Moreover, the next Bitcoin halving is expected to happen early in 2020, which was in previous cases followed by a strongly bullish market sentiment (2012, 2016). Since markets usually behave cyclically, this may also be the fuel behind the next BTC bull run.
However, the last time BTC surged, transaction fees also went through the roof as the network became congested. In 2019, there are far more crypto users than two years ago, and if BItcoin reaches the new ATH, who knows what the state of the network will be with more than a half of $800 billion of market capitalization taken by Bitcoin’s ecosystem.
Nevertheless, BTC also advanced as a payment system and the Lightning network is available despite that it can’t be called exactly user-friendly, so it remains to be seen how the oldest cryptocurrency will handle the traffic.
Technical analysis - BTC Price 2019
The daily BTC/USD chart presented above clearly shows that, similarly to the events in 2017, this year BTC spent the whole first fiscal quarter fluctuating between $3,300 and $4,100. Despite the fact that it represents the change of around 24%, in the cryptocurrency market, that kind of price movement can easily be called horizontal.
Still, towards the end of the quarter, the RSI reading and buying volume show that the trust has been regained and that the positive atmosphere can be “smelled” as the newfound support at $3,680 has proven to be unbreakable since the late February.
With the first days of the second fiscal quarter, the first serious movement began for Bitcoin as the buying volume started growing along with the overall market capitalization. Looking at the chart above, we realize that BTC was heavily overbought during two buying sessions as the first one was accompanied by the RSI divergence, naturally followed by a short retracement.
The retracement was stopped by the support at $7,400 as the investors flooded in to raise the price by almost 50% towards the year’s high of $13,800. Currently, the price of Bitcoin is hanging in balance around $11,200 with the BTC’s market dominance of 62%.
Comparison - Bitcoin Price 2017 VS 2019
When comparing the two situations, we can deduce that there are many similarities between the first two fiscal quarters of 2017 and 2019 when the TA is concerned. Both times BTC started the year lazily pulsating between two prices just to rally towards the second half of the second quarter.
However, the fundamentals are seriously different this time around.
While Google searches show that the interest is rising, this time around it is hard to imagine that the FOMO could reach such scales. All the problems of crypto have already been unveiled, specifically those of the scalability and regulatory nature of the number one coin in the market, therefore, there are much less so-called Bitcoin maximalists (or they still keep quiet?).
Short term (Swing) - Bitcoin Prediction
The above chart shows that BTC is indeed in the period of indecision since the RSI readings do not cross into extreme areas (the blue rectangle). In the meantime, trendlines form a triangle which, sadly, can’t be defined as rising or declining, further deepening the insecurity.
According to the TA, it is highly possible for BTC to test the $10,300 support again in the coming days.
Long term - Bitcoin Prediction
Of course, there is another possibility visible by the blue area in the chart above. If the price drops even below the $10,300 support, Bitcoin could as well take a cup and handle road, which would also be able to follow the green trendline. In that case, we could see BTC in the area of $17,000 until late November.
All things considered; we are very bullish when BTC is concerned because it has shown resistance towards the unfortunate market events such as the Binance hack which happened this year. Such occurrences used to bring the price down by sometimes more than 20%.
Exactly that toughness, along with fantastic fundamentals and the first mover bonus, is the driving force behind Bitcoin and it seems that this will not go away any time soon. If you are interested in more crypto price predictions you can check our Stellar Lumens price prediction article.
Disclaimer: Note that this is not investment advice. Cryptocurrencies are highly volatile and very risky speculations. Please, consider consulting an investment professional before investing. Never invest more than you can afford to lose. Do not borrow funds to invest.