Bitcoin Price Breaks Below $8,300, Is The Bull Rally Already Over?
But what are the factors behind Bitcoin’s latest drop, and how far might the crypto asset dive before it finds support?
Bitcoin Price Inches Below $8,300, But Is There Much Further to Fall?
The leading cryptocurrency by market cap has spent the last six months locked in a downtrend. However, that downtrend was considered broken by many during the recent bull rally in Bitcoin, causing many to expect at least a short-term uptrend to follow.
And while Bitcoin price did rise as much as 35% in less than 30 days, it failed to break through overhead resistance and reclaim past highs.
Now, as of this morning, Bitcoin price pierced through $8,300 temporarily after a more than $400 selloff began in the late-night hours.
The crypto asset is back above $8,300 currently, however, it is not until prices much lower where Bitcoin could find support.
The drop in price is surprising for many, but there may be a variety of factors influencing the bearish movement.
Factors Behind Today’s Crypto Market Crash
Notably, Bitcoin price failed to break above the 200-day moving average, which may have signaled to larger investors that the crypto asset wasn’t yet for a new uptrend, and started to sell the asset to reduce risk.
Bitcoin price may be headed back to retest the 50-day moving average, which is currently sitting at around $7,500.
Before it reaches that key level where support could be found, the cryptocurrency is likely to test support levels at $8,000 to $8,200, then lower at $7,600 to $7,800.
The leading cryptocurrency by market cap must not fall back below $7,400 where the inverse head and shoulders breakout confirmed, or else a new low could be set in the days following.
With Bitcoin’s halving ahead, and after two full years of bar market, it could be on the verge of a major breakout. But for that to happen, the 200-day moving average must be taken, with multiple daily closes above it along with a retest of resistance turned support.
In the worst-case scenario, the current top could follow the path of the July 2018 rally, which eventually led the cryptocurrency to reach its current bear market low of $3,100.
Breaking down to set a new local low, could cause the market to panic, and a retest of the lowest ranges over the last two years may need to be tested and confirmed as support for an uptrend to begin again.