In the short term, BTC price movement to the level of $6300 is more likely than the rise to $7000 due to insufficient trading volume.
Small volumes again
Over the last 24 hours, the daily trading volumes of Bitcoin decreased by 15%, from $4.6 billion to $3.9 billion. Daily volumes of Ether, cryptocurrency of Ethereum blockchain platform, have also decreased by more than 31%. Meanwhile, the daily volumes of Tether increased by 10% and reached $2 billion. This signals that traders on cryptocurrency exchanges such as Binance began to hedge volumes of the main digital assets into dollars through stable cryptocurrencies.
Since July 2, the cost of BTC has remained relatively stable and made about $6500, showing light volatility at the level around $6300 - $6700. But over the last five days, BTC has been making strong attempts to move sharply both up and down, mainly due to small daily trading volumes of this asset.
In the short term, BTC price is more likely drop to $6000 than to rise above $7000. Neither Bitcoin nor Ether was able to provide a stable growth after a long and strong correction. Almost all coins showed a negative trend. However, in the medium term, if there is a major breakthrough of downward trend line which has been stretching since the end of December 2017, we can expect a steep rise in value.
Some investors including CEO of BitMEX exchange Arthur Hayes suggested that a major success in the field of regulation or approval of public trading of the asset can ensure a sharp upsurge of BTC and other cryptocurrencies prices.
CypherSpook - a hedge fund trader and BTC expert - suggested that Bitcoin can reach $50 000, while Hayes forecasted a breakthrough of the downward trend line of the last September and increase in volumes.
Volume is a real problem
During the previous correction, which led to recovery of BTC price to the key support levels of $10000 and $12000, the volume has easily exceeded $7 billion and ranged between $9 and $10 billion.
Now the volume of BTC hardly manages to remain at the level above $4 billion, which is almost similar to the volume of Tether – USDT. While the majority of investors believe that BTC price will start to grow steeply in the fourth quarter of 2018, it is quite difficult to forecast the time when the market will reverse, due to unpredictability of the daily market volume.
Similar to correction in 2017, now the cryptocurrency market has to go through a period of stability and recovery before reaching the level of $500 billion, which was observed in November 2017. Most likely, recovery to the level of November and December will take about 4 - 5 months, even if there will be major changes in the regulatory framework relating to regulation of the crypto industry.