Bitcoin Steadies after Wednesday’s Slide and a Choppy Start to the Day

Bitcoin slid 8.59% on Wednesday to reverse, not only Tuesday’s 5.09% gain, but also Monday’s 3.71% rise, ending the day at $6,788.49.

A broad market sell-off attributed to a material shift in market risk appetite across all of the asset classes saw investors head for the door as momentum from late Tuesday that led to an early intraday high $7,430 reversed in the early part of the day.

Bitcoin slid through the day’s first major support level of $7,106.3 and 2^nd support level of $6,801.01 to an intraday low $6,710.38, reversing the short-term bullish trend formed back at Sunday’s swing low $6,427.16, as Bitcoin investors stayed on the side lines through the day’s 62% FIB Retracement Level of $6,839.6.

While cryptocurrencies are decentralized and supposed to be free of influence from central banks and governments, through the 1^st quarter of this year, the influence was certainly evident as the talk of a ramp up in regulations and the possible banning of exchanges in key jurisdictions weighed.

The flare up between China and the U.S on Wednesday, two significant cryptocurrency jurisdictions, likely contributed to the slide through the day, with the regulatory uncertainty leaving the cryptomarket particularly sensitive to anything negative.

Wednesday’s moves certainly suggest and reinforce the view that Bitcoin is not the new gold and will unlikely ever replace gold as a safe haven, the volatility seen in Bitcoin and the rest of the cryptocurrencies far exceeding anything seen in the global equity markets.

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Sentiment through the early part of this morning supported the view that risk aversion contributed to Wednesday’s pull back, with Bitcoin up 0.08% to $6,805.7, though the morning has been far from smooth.

A start of the day slide to a morning $6,578.95 low came from a continuation of an end of day sell-off on Wednesday, with Bitcoin managing to bounce back to a morning high $6,860.46 before settling at current levels.

For the day ahead, with the morning low finding support from the day’s first major support level of $6,515.91, some comfort will likely ease market fears of another slide through the day, with a move through to the morning’s high $6,860.46 supporting at run at $7,000 levels and the day’s 23.6 FIB Retracement Level of $7,078.7.

Any run at the day’s first major resistance level of $7,235.53 would need to see a marked improvement in sentiment across the broader market, with investors likely to be cagey early on, following Wednesday’s sell-off.

Failure to move through to $7,000 levels could see Bitcoin pullback through this morning’s low and test the day’s first major support level of $6,515.91, which should hold Bitcoin from seeing more material declines through the day, barring any negative news hitting the wires.

Elsewhere, Litecoin was up 1.01%, with NEM’s XEM leading the way amongst the majors, up 2.1%, while Cardano’s ADA was down 1.37% at the time of writing.

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