Bitcoin
Reasons Why Bitcoin Could Drop to $48,500 Soon
It looks like the market is in a dangerous free fall! Amid the long-awaited Mt. Gox Refunds It is Sale of Germany of seized BTC, the cryptocurrency market is mired in negative sentiment. The 4-hour RSI chart plunged to a low of 17.88 as trading opened in Asian countries, signaling a worrying outlook.
This level of fear and uncertainty is palpable, making traders extremely cautious.
Read on to navigate the charts, understand the fear, and see if there is opportunity amid the chaos.
Key resistance levels ahead
The Fibonacci retracement shows resistance at the $56,000 level, and it’s not the only hurdle. There’s significant resistance at the $59,000, $61,000, and $63,800 zones, making any recovery look like an uphill battle.
Source: TradingView
Settlement data
Over the past 24 hours, more than 230,000 traders faced liquidations totaling $654.70 million, according to data from Coinglass. The largest single liquidation occurred on Binance, where an ETH/USDT long position worth $18.48 million was wiped out. BTC alone saw $204.52 million worth of long positions liquidated, with the market falling from $58,625 to $53,779.
Source: Coinglass
From here on it’s all downhill!
BTC has been on a continuous downward spiral since shining an Evening Star at its all-time high price of $63,834. Despite minor recoveries along the way, it has failed to stop the plunge to $53,779 — a steep 15.50% drop. Bitcoin has shown a 4.79% recovery from the ground support of $53,900 to $55,900 but is still struggling to break the resistance, facing rejection and falling back to $55,000.
Source: TradingView
According to the trend, if the price fails to hold at this level, there is a high chance of a drop to $48,500. The current support level is an old zone created three years ago in 2021 when BTC surged to $68,000.
Source: TradingView
Factors that increase pressure
This period has been marked by ups and downs for Bitcoin and its investors, influenced by external factors such as the Mt. Gox refunds and the sale of seized BTC by the German government. These external factors have added layers of complexity and anxiety to the market, creating a perfect storm of uncertainty.
The cryptocurrency market is notoriously volatile, and events like these only add fuel to the fire. Traders need to stay informed and vigilant. With the market in turmoil, it’s crucial to be prepared for whatever comes next. This rollercoaster ride may seem daunting, but it’s also an opportunity for those who can ride the waves of the crypto ocean.
Strategies for Survival
There are a few key strategies that investors should understand and follow. Keeping an eye on the charts, watching for key resistance levels, and preparing for sudden drops can be a lifesaver.
The world of cryptocurrencies is unpredictable, but with the right strategies and a good sense of the market, you can turn the tide in your favor.
Read too: Will BRC-20 Tokens Drop 25% as Bitcoin Price Fails to Hold $55K Mark?