Technical analysts predict that Bitcoin [BTC] has not seen the worst of its bearish rally as of yet. Robert Sluymer of Fundstrat, a technical analysis firm, has stated that we should expect “further testing of the next support level”.
The coin has also fallen below its 50-day moving average, which is usually indicative of a bearish run. Sluymer provided more clarity on the price movement, stating:
“You’re getting a bounce today, but I expect the next level of support down close to $6,100. It’s pretty early to make the case that you need to go long. It’s got to stabilize first.”
An analyst from Bloomberg Intelligence, Mike McGlone, stated that the price of Bitcoin will decline further. He stated that this correction was “tame” when compared to those that came before. He said:
“Bitcoin is in dump mode, following the pump run-up on the potential for a U.S. ETF. It may not subside until revisiting good support near $4,000 – last year’s mean.”
Bitcoin has had a tough beginning to the 3rd quarter of the year, seeing significant losses as the bear market takes hold. The opening price of the top cryptocurrency this month was very close to the opening price seen for July. The coin was trading at around the $6200 to $6400 mark for the first week of the month, continuing from a bearish run towards the latter half of July.
The coin had a rollercoaster month in July, as its starting values were quickly forgotten as a spike in price occurred on July 17th. The price quickly moved from $6700 to $7300 in the matter of a fe whours, causing widespread fear of missing out among investors. Moreover, short positions were decimated by the sudden price growth.
The rally did not stop, however, as the coin jumped to $8000 soon after, from a low of $7400 on July 23rd. It broke the $8000 mark on July 24th but saw a worrying drop soon after.
The decline correlated very strongly to the denial of a proposal for an exchange-traded fund offered by Winklevoss. The proposal was denied by the United States Securities and Exchanges Commission citing the reason that the market is prone to manipulation. Notwithstanding the bad press surrounding the ETF, the price declined from $8200 to $7800 and made a quick recovery back to $8200 on July 28th.
The decline to sub-$7000 levels began on July 31st, going from $8100 to $7600 by August 1st. There was a further drop to $7000 by August 4th. The coin traded around the $7000 level, mostly below the support until 8th August. It then broke the $7000 mark on August 8th, dropping down to a low of $6300 after the news of the VanEck ETF being scheduled broke.
Bitcoin is trading at $6500, showing a growth of 2.8% in 24 hours and 1.38% in 1 hour. The coin is close to gaining control of about half of the total cryptocurrency market, as it is currently at 49.1% dominance. Its $111 billion market capitalization is indicative of when the market itself bled around $30 billion when Bitcoin dropped below $7000.
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