Bitcoin has crashed nearby in the past few hours and is experiencing a key level of psychological support near $ 18,000.
At approximately 06:00 UTC on December 8, the world’s first cryptocurrency price dropped to approximately $ 18,031 from $ 18,770. Subsequently, it dropped back slightly to $ 18,200 by press time, according to CoinDesk’s bitcoin price index.
The last time bitcoin experienced a similar fall was on Dec. 1 after the cryptocurrency bellwether reached an all-time high of about $ 19,920, per BPI.
According to Ki Young Ju, CEO of CryptoQuant, the availability of significant quantities of bitcoin on large-holder exchanges – “whales,” as they are often called – contributed to the price fall.
“In terms of short-term price prediction, I think supply and demand are the most important data, said Ki Young Ju, CEO of CryptoQuant. “I think this plumber started from bitcoin … whales who wanted to keep their bitcoin on exchanges making them readily available for sale orders.”
Others see recent buyers extracting their benefits from the market. Lucas Huang, head of growth of Tokenlon’s decentralized exchange, noted that “from a retail trading perspective,” an 80% increase in the price of bitcoin over just two months could be too tempting a profit not to take. ”
Meanwhile, perhaps another signal is coming from how Wall Street views the prospects of one particularly large buyer in recent months. Tyler Radke, an analyst at Citibank, downgraded his recommendation on business intelligence company MicroStrategy to “sell” from “neutral,” drawing the attention of investors that bitcoin euphoria could be overestimated.
Not everyone is bearish on bitcoin. “Bitcoin’s latest move down is a rest stop en route to $ 30k levels by mid-2021,” said investor Jehan Chu, co-founder of Kenetic Capital. “Experienced bitcoin investors are used to these drops and understand them as opportunities to buy the dip. In the longer term, we can expect these movements to become less frequent as institutional funds continue to plunge into the market and volatility deteriorates further. “
And yet, in the near term for technical analysts, the latest price action for bitcoin represents a continuing narrative of lower peaks on the daily chart. That signals a weakening of consumer interest in the midst of increasing daily sales volume.
Should buyers fail to push prices above $ 18,600, a probable period of disadvantage may now break out as the short-term trend flips from bullish to bearish.
Other notable cryptocurrencies are also suffering, including ether, XRP and litecoin. Those three are down between 7% and 9% in the last 24 hours as well. In fact, all 17 free float cryptopcurrencies besides bitcoin in the CoinDesk 20 have dropped between 6% and 12% in the last day.
Meanwhile, traditional markets have held steady on the day with the Dow Jones Industrial Average closing 0.35% in the green and the S&P 500 index up around 0.28% on the day.