Bitcoin price fell -5% the last 24HR, falling from $9,600 levels to $9,096 ( at the time of this reporting ). Altcoin markets followed Bitcoin, witnessing a sharp sell-off as well. Total cryptocurrency market capitalization sits around $251 billion, which is down $9 billion the last 24HR. Why could Bitcoin potentially test $8,000 levels in the near term?
Bitcoin continues to see a sharp sell-off post “halving.” As mentioned in a previous report, many investors are failing to see the surge they hoped for post halving. The last 24HR, Bitcoins price has fallen -4.26%. During the last week, Bitcoins price has sold off for nearly -7%. In previous market analysis, it was believed that the catalyst behind the sell-off was hash rate and miner sentiment. In addition, it was noted that Bitcoin could very well witness a bearish environment if the hash rate were to drop 30-40%. BTC price is now flirting with key support levels. Hash rate ( which is positively correlated to price action ) has been struggling post halving.
Bitcoin Technical Analysis
In a recent tweet, Visionary Financial stressed the fact that Bitcoins price could very well test $8,000 levels. It was outlined that $9,050 would serve as a strong support level. At the time of this reporting, BTC price is hovering right around that support zone. If we see a $9,050 reject and hold, one could very well argue the -10% downside risk in the near term. If Bitcoin was to test $8,000 - that would most likely be one of the most important support zones in years, keeping into consideration the environment the miners are operating in right now.
As we can see from the updated chart, the support zone is being heavily tested. In addition, another red flag is the 25 day moving average ( grey ) line. Bitcoin recently dipped below the 25 day MA, which hasn’t been good historically. Over the last 1 year, Bitcoins price has seen $1,000-2,000 price corrections following the 25 day moving average rejection. It will be interesting to see if Bitcoin can experience a reversal before the close. RSI ( relative strength index ) is also starting to see a downward trend. With the looks of technicals right now, that $8,000 test could be the next target for Bitcoin. If this were to happen, it will get very interesting for the miner network. It was already mentioned that this was the first time in Bitcoins history that miners were asked to produce in a non-profitable environment. If we continue to see a sell-off, you might start to see a lot of miners get cold feed.
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