Carnage is taking place in the cryptocurrency space. Bitcoin has stepped over the brink and has fallen to $54,000. And it probably isn’t even over yet. The main support at $51,000 awaits below. Could $BTC fall even further than this?
A full 30% correction coming?
It has been a wretched week for Bitcoin and the cryptocurrency market. The Alpha crypto currency fell nearly 15%, which equates to a loss of around $9,300. This is also now a 27% reversal since those heady days of the $73,800 top. If Bitcoin continues down to the major support at $51,000, this will have been a full 30% correction.
So what are the chances of Bitcoin getting down to that $51,000 level? The indicators would say that they are pretty good. The $BTC price is currently hanging on by a fingernail to some minor support at $54,600, but has already gone lower than this, and earlier on Friday it reached as low as $53,250.
Lowest crypto sentiment for last 12 months
Source: Alternative (Fear and Greed Index)
Sentiment for crypto has plummeted over the last month, according to the Fear and Greed Index. From an indication of Greed, and a score of 75 last month, the indicator is now pointing to Fear, at a score of 29, which is the lowest reading in the previous 12 months.
$51,000 approaching - could the price even go to $43,000?
Source: TradingView
The weekly chart for the price of $BTC is now starting to look quite ugly. It seems that the M top pattern (a very bearish structure) is playing out. With the continued selling pressure from long term holders, US, and German governments et al., it does look as though the $BTC price will get down to $51,000. That said, it must be noted that $51,500 lines up perfectly with the 0.382 fibonacci, therefore a bounce from here could in fact be very bullish
However, the question has to be asked: “Will it stop there?” If this support does not hold then $43,000 is the next major level, with perhaps some support before this at $48,000 down to $46,000. This would be fairly catastrophic for Bitcoin, and it is to be wondered if the price would be able to recover from this kind of correction and still get back to the all-time highs and beyond. Why Bitcoin?
It’s at times like these that investors have to question why they made their investments into Bitcoin. The fundamentals are still as strong as they ever were, and as governments print more and more currency in order to service their debts, Bitcoin is only going to be more and more in demand.
As long as your investment time horizon is for the next 10 years, it can be imagined that Bitcoin will be a whole lot higher after this period of time. The same will certainly not be able to be said about fiat currencies. They are all headed to zero - one just needs to do the research and the maths in order to ascertain this.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
