Bitcoin had been tethering at $20,000 over the past week. Its ability to maintain this level after the FOMC announcement led to speculations about whether the digital asset has finally reached its lowest point. However, recent developments and bitcoin’s fall below $20,000 has proven that this is not the case. It also points out a continued decline in market which could cause the cryptocurrency to plummet to new lows.
Bottom Does Not Exist
Bitcoin trades at $19,000 now, completely destroying the expectations that $20,000. was the top. Although Bitcoin is trading in the $19,000 range, this has completely destroyed the expectation that the bottom was already marked at $20,000.
The market could see lows of $17,000. The question is now what could trigger this price decline? It could easily be attributed to Binance’s ongoing fight with FTX.
The market is already feeling the effects of Binance wanting to dump more than $500 worth of FTT, which has triggered a more than 30% decline in the token’s price already. But, like so often in the crypto market it’s not limited to FTT. Other cryptocurrencies are also suffering, such as Bitcoin which lost approximately $1,000 in 24 hours.
BTC prices fall below $20,000| Source: BTCUSD on TradingView.com
Bitcoin Will Recover
The possibility of a bitcoin price recovery is unlikely, given the fact that a fall in price is inevitable. A significant rebound from the current point in bitcoin’s price is unlikely, however, as it is still far below its lowest level. It is unlikely that bitcoin will break below $22,000 before this occurs.
A significant drop in market prices was also a result of the recent price rise. This was a great opportunity for investors to gain short-term profits, however the end result was loss of support at $22,000
The current macro environment is what determines bitcoin’s value. This high correlation means that it will be dependent on the overall economic climate. The digital asset is unlikely to see significant value pumps until there is some sort of settling. Further decline is likely due to disruptions in the macro environment, ongoing problems with Binance and FTX.
Featured Image from Analytics Insight. Chart from TradingView.com
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