Following days of consolidation Bitcoin has reached the end of its pennant formation. The big move that many analysts had expected came a few hours ago, and it was followed by a second slide resulting in a drop towards critical support levels.
Bitcoin Dumps $1,000 Again
For most of this week, analysts have been largely undecided on the next direction Bitcoin would take. Those that lent towards bearish would have been right as another huge red candle has sent the digital asset tumbling back into four figures.
Optimism was quickly quashed following a brief climb to $10,250 during late trading yesterday. BTC did not stay there long and the resultant candle wiped out $700 in under an hour. The breakout from the wedge had occurred and it went heavily south.
The next couple of hours saw BTC plunge to and hold around the $9,675 level. The pain was not over however and a second slide sent the king of crypto crashing down to $9,325 according to Tradingview charts.
BTC price 4 hour chart – Tradingview.com
The thousand dollar dump is nothing new though, it has happened five times since this rally began in April so investors should not be concerned. It even occurred earlier this month as pointed out by trader ‘CryptoHamster’
Déjà vu$BTC $BTCUSD #bitcoin pic.twitter.com/OAyNLDwsHc
— CryptoHamster (@CryptoHamsterIO) August 29, 2019
What happens next could spark a little more panic though if BTC fails to hold on to support above $9k. Over the past week or so analysts have been making bearish predictions, and they have not been wrong. Current scenarios could see Bitcoin falling back into the $8,000 range where a number of technical indicators have aligned.
There will be a number of traders actually waiting for a fall into the $8k range and a chance to accumulate more BTC. ‘WelsonTrader’ is one that is waiting for the scenario to play out after predicting a fall to the current trend line.
“If it can’t hold here, then we will be going under $8,000! I’m super excited to see how this plays out”
At the time of writing Bitcoin had climbed back above $9,400 and was holding there. In previous scenarios the buying pressure has been enough to push prices back over $10k within a day or so but this time things may be different.
The big purge has resulted in a total crypto market loss of $20 billion over 24 hours which is one of the largest dumps of the year. Bitcoin dominance is still over 71 percent though which means, as usual, the altcoins have been smashed even harder.
Image from Shutterstock
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