As a seasoned researcher with over a decade of experience in the financial markets, I have seen my fair share of market volatility. Today’s Bitcoin crash to $49,000 is a stark reminder of the rollercoaster ride that is cryptocurrency trading.
Currently, the price of Bitcoin is decreasing. Earlier today, it plummeted to as low as $49,000, marking a 30% drop from its peak in July. Although Bitcoin briefly recovered some losses, the overall trend appears to be downward, as indicated by the candlestick pattern on the daily chart. The significant selling of Bitcoin is impacting not only the Bitcoin market but also other altcoins and cryptocurrencies. At the moment, the total crypto market capitalization, as reported by CoinMarketCap, stands at around $1.82 trillion, a decrease of 15.46%.
Bitcoin At A Precarious Level: Bears Might Force Prices To $40,000
From a high-level perspective, an analyst predicts that if sellers continue to push, there could be further declines ahead in the near future.
Discussing with X and referring to transactions recorded on the blockchain, the analyst pointed out that since Bitcoin dropped 12% below its actual market value, it now stands at a significant point. Historically, the price has risen again, returning to its main upward trend when Bitcoin’s price touched this level.
An on-chain trader has discovered that ‘realized price’ refers to the typical cost at which present Bitcoin (BTC) owners originally purchased their tokens. At this point, BTC is significantly below the realized price, implying these holders are in a loss position and may be considering selling to mitigate risk.
If Bitcoin continues its current downtrend today, it’s likely that more holders might decide to swap their BTC for stablecoins or fiat currency. This could speed up the selling trend. As per an on-chain analyst’s prediction, Bitcoin could potentially plummet towards $40,000 if sellers intensify their pressure.
Time For Institutions To Buy At A Discount?
As a seasoned trader with over two decades of experience in the cryptocurrency market, I have seen my fair share of market fluctuations and reversals. The recent downturn in Bitcoin (BTC) prices is a stark reminder of the unpredictable nature of this exciting yet volatile market.
In simpler terms, the trading activity on August 5th was extensive with a significant number of trades, indicating a strong sell-off. Given that Bitcoin is currently in a bear market trend, it’s quite likely that its price could drop to around the 78.6% Fibonacci level or even down to $35,000.
If Bitcoin manages to find support this week, it could encourage bulls and aid in its recovery, which would be a positive turn of events given that today’s price drop caused Bitcoin to dip below the average cost basis of BlackRock’s spot Bitcoin ETF, currently at approximately $58,700.
So, if the prices stay within this price range or even dip slightly, large-scale investors like BlackRock could potentially increase their purchases, taking advantage of lower costs.
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2024-08-06 08:41