- The Bitcoin price stayed near $35,000 and analysts predict this number to be an important one.
- An increase higher than this could bring Bitcoin back to all-time highs of $41,000 or so, but a heavy dip below it could cause a downfall to $30,000.
- Although the longterm forecast remains slanted to the upside, more losses could come soon,” strategist Daniel Moss said recently.
Bitcoin dropped Wednesday, going for its biggest fall since August, as a stronger dollar and profit-taking went through $172 billion of Bitcoin pricing since the beginning of the week, leaving the number at a vital crossroads.
Other coins like XRP and Ethereum, and smaller alt-coins Cardano and Litecoin declined after days of greater volatility.
Trade in cryptos has been increasing for the past five months. Bitcoin has gone up by 230% during this time, breaking a record of $41,000 on the 8th of January, while Ethereum raked in a gain of 217%, causing many top investors to warn about the dangers of a bubble burst.
Investor Mark Cuban said on Tuesday that cryptos look like the tech bubble of the 90s, but added that any bursting would have some surviving coins, while others would fail.
“The crypto market has been under attack recently, with Ethereum and Bitcoin going lower as an increase of risk aversion takes over the global markets. Although the longterm forecast for crypto is slanted to the upside, more losses look possible in the coming days,” strategist Daniel Moss stated in a memo.
Bitcoin was at $34,580, up near 1.65% on the day on Coinbase’s exchange.
With the dip to $35,000, the price is staying near important technical numbers on the charts, and a significant increase, or significant decrease, could make way for the next skyrocketing toward new highs, or a bitter decline, analysts claim.
“Failing to lock in a strong grasp above last week’s close could allow sellers to push prices back to the psychological foundation of $30,000. Breaking through that could push us towards previous resistance at $19,891, Moss stated.
Bitcoin is still 95% higher than last month, but the charts reveal this latest change in price has created many support levels.
The price is closing in on important Fibonacci retracement levels. Fibonacci retracements are horizontal lines that reveal where resistance and support are possible based upon the price’s highs and lows and a break of these lines can very often cause a huge shift in the price either lower or higher.
An analyst for FXEmpire, Chris Svorcik, said the asset must stay higher than $29,762, which is the 50% mark between the high of January 12 and the low of December 11, to avoid dropping near $26,000.
“If the price stays higher than the 50-61.8% Fibonacci area, there is a good chance of a continuing increase and a new all time high. But a dip beneath the Fibonacci levels will change that,” he stated.
Meanwhile, Ethereum, which was trading up 2.8% on the day at a number of around $1,079, also is at a pivotal point on the charts. The price went to a three-year high on Sunday, hitting $1,350. But its downturn since has given up over half of the gains it earned since 2021 kicked off, leaving it right at the Fibonacci level.
“Ethereum needs to go past the 23.6% FIB and $1,069 to support a push on its major resistance level of $1,131,” Bob Mason, a technical analyst, said.
“But for Ethereum to go back to $1,100 prices, overall market support is needed, ” he said, going on to add: “In the circumstance of a prolonged cryptocurrency rally, Ethereum may try resistance at the $1,250 marker before any dip occurs.”
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