Bitcoin – Bears Back in Control with $5,000 Levels in Sight

Bitcoin hits the slopes early this morning, unraveling the consensus that Bitcoin had bottomed out, a lack of direciton ultimately doing the damage.
Bob Mason
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Bitcoin fell by 0.52% on Wednesday, following a 0.15% decline on Tuesday, to end the day at $6,628.1, the hold on to $6,600 levels by the day’s end being the 4th consecutive and 5th out of the last 6 sessions.

A particularly bearish start to the day saw Bitcoin tumble from a start of a day intraday high $6,663.1 to an early morning intraday low $6,513.5, the reversal seeing Bitcoin slide through the first major support level at $6,618 and second major support level at $6,573 before steadying. Key for the day was Bitcoin managing to steer clear of sub-$6,500 support levels.

Recovering through the morning and afternoon, Bitcoin managed to strike a 2nd half of a day high $6,639 before pulling back late in the day to extended the day’s losses.

Having managed to avoid sub-$6,600 levels on Tuesday, Wednesday’s early morning sell-off was a reminder of what kind of volatility can be present in the cryptomarket, though by historical standards a less than $200 sell-off pales into insignificance to the in excess of $1,000 sell-offs of old that took place in a matter of minutes.

Through the early part of the day, the downside was likely to be off the back of the IMF’s comments in relation to Bitcoin and the broader market, a recovery through the afternoon limited, with concerns over a possible shift in the regulatory landscape and the SEC’s pending decisions on the Bitcoin ETF applications continuing to pin Bitcoin and the broader cryptomarket back from any upward moves.

With the majors showing plenty of sensitivity to the news wires, it’s not just the IMF’s comments that flustered the cryptomarket on Wednesday, with negative outlooks, talks of a cryptomarket implosion and a report released by researchers from two prominent universities in the U.S also weighing, the report concluding that China has sufficient Bitcoin hashpower to ultimately bring down the Bitcoin network.

The news may not have been focused on what investors had been looking out for, but when considering the latest research paper on Bitcoin, China’s possible influences on Bitcoin and the broader market, there’s perhaps yet another reason for the SEC to hold off from approving the Bitcoin ETF applications under review. After all, China has become the U.S administration’s enemy #1 of late.

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At the time of writing, Bitcoin was down a whopping 4.54% to $6,329.2, with an early morning slide seeing Bitcoin tumble from a start of a day high $6,630.1 to an early morning low $6,252.2 before recovering to $6,300 levels.

The early morning reversal saw Bitcoin slide through the day’s major support levels before recovering through the third major support level at $6,302.37, Bitcoin having touched $6,200 levels for the first time since 19th September.

For the day ahead, a move back through to $6,400 levels would bring the day’s second major support level at $6,451.97 into play, while $6,500 levels will likely be out of reach on the day, with Bitcoin needing to avoid another pullback through the third major support level at $6,302.37 to sub-$6,300 levels to support the chances of an afternoon recovery.

Failure to hold on to $6,300 levels and move back through to $6,400 levels could see Bitcoin’s losses deepen, with the bears likely to begin eyeing sub-$5,000, a pullback through the morning low $6,252.2 unlikely to see Bitcoin strike sub-$6,200 levels today, barring materially negative news hitting the wires.

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