A technical ray of light for bitcoin bulls

Stacks of bitcoins sit near green lights on a data cable terminal inside a communications room at an office in this arranged photograph in London, U.K., on Tuesday, Sept. 5, 2017. Bitcoin steadied after its biggest drop since June as investors and speculators reappraised the outlook for initial coin offerings. , Bloomberg/Bloomberg

Olivia Schaber, Bloomberg News

Jun 29, 2018

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In a dismal year for Bitcoin, one technical gauge suggests investors may be in for a reprieve.

The Williams Percentage R indicator, or WLPR, helps chart whether a security is oversold or overbought. Right now, it’s signaling that the world’s largest cryptocurrency may see a potential reversal of its current downward trajectory.

The analysis captures ideal entry and exit levels for buying or selling an asset. Data show that Bitcoin breached the level -80 marker of the indicator this week, a threshold suggesting to traders it may be time to get in on the action.

The gauge has proven fairly accurate over the past year -- for example, when it signaled in April that the cryptocurrency was overbought the day before Bitcoin fell 4 percent.

Bitcoin has fallen almost 60 per cent this year after nearly reaching US$20,000 in December. On Friday it was trading just under US$6,000.