Bitcoin – Bears Hit sub-$5,000 Levels in Crypto MeltdownEarly gains for Bitcoin and the broader market, following Monday’s sell-off may be of little relief, with the negative bias still in play.
Bitcoin tumbled by 13.05% on Monday, following on from last week’s 12.2% slide, to end the day at $4,920.7.
A particularly bearish week going into the Bitcoin Cash hard fork had already inflicted plenty of damage on Bitcoin and the broader market and, in spite of a marked increase in Bitcoin Cash ABC’s hash rate on Monday, the damage had been done, with investors unable to shake off the negative sentiment stemming from the attempted 51% attack by the Bitcoin Cash SV camp.
The day’s reversal saw Bitcoin slide through the day’s major support levels with relative ease to hit an intraday low and new swing lo $4,855, which also marked Bitcoin’s lowest strike price since mid-October of last year.
With a start of a day intraday high $5,659.5 coming up well short of the first major resistance level at $5,729.77 and with Bitcoin now some way off the 23.6% FIB Retracement Level of $6,069, the Bitcoin bears are fully in control, October’s low volatility environment having been an ominous sign, with so much uncertainty over the regulatory landscape and the SEC’s willingness to approve the 9 Bitcoin ETF applications having pinned back Bitcoin and the broader market.
None of the majors were left unscathed at the start of the week, while Ripple’s XRP saw more moderate losses, which supports those forecasting Ripple’s XRP to rise to the number one spot by market cap in the coming years and perhaps sooner should the markets see more dark days ahead.
Few, if any, have referred to the Bitcoin bubble of late and whether the latest reversal supports those who have continued to suggest that Bitcoin and the broader market is nothing but a bubble ready to burst.
When considering Bitcoin’s slide from just shy of $20,000 to Monday’s day ending $4,920.7, that’s a 75% slide from its all-time high, which was only back in mid-December of last year.
At the time of writing, Bitcoin was up 1% to $4,970, with moves through the early hours seeing Bitcoin rise from a start of a day morning low $4,919.9 to a morning high $5,041.8 before falling back to sub-$5,000 levels, the day’s major support and resistance levels left untested early on.
For the day ahead, a move back through to $5,000 levels and the morning high $5,041.8 would support a run at $5,100 levels, though we can expect Bitcoin to come up well short of the first major resistance level at $5,435.13, with resistance at $5,000 likely to pin Bitcoin back from a breakout, barring particularly positive news hitting the wires.
Failure to move back through to $5,000 levels would continue to support the negative bias, with a pullback through the morning low $4,919.9 bringing Monday’s swing to $4,855 into play before any recovery, the day’s first major support level at $4,630.63 unlikely to be tested, barring materially negative news hitting the wires.