Bitcoin crashes near $40,000
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Investing.com – After beginning to correct Thursday night, the price accelerated its fall sharply overnight Thursday into Friday, breaking below the $40,000 threshold, before stabilizing above $38,000 during the trading day. yesterday, which had fueled hopes of a rebound.
Unfortunately, Bitcoin and the entire cryptocurrency market resumed their dive yesterday, with Bitcoin dropping as low as $35,500, while Bitcoin hovered just below $2,500.
Compared to Thursday’s peak at $43,540, BTC/USD therefore showed a fall of more than 18% on the low of the night from Friday to Saturday.
As for the reasons for this collapse of the cryptocurrency market, it seems that it was the widespread risk aversion that has largely weighed on Bitcoin and other digital currencies. It should be noted that the closed down 2.72% yesterday, after falling 1.30% the day before. The for its part lost 1.9% yesterday after 1.10% on Thursday.
Rising rates prompted investors to shed their positions in riskier assets. At the start of the week, the benchmark Treasury yield rose above 1.9%. The Federal Reserve has also signaled that it plans to start shrinking its balance sheet, as well as cutting bonds and raising interest rates.
However, a common investment argument for bitcoin is that it serves as a hedge against rising inflation resulting from lax monetary policies, and so the risk is that a more hawkish Federal Reserve could deprive Bitcoin of this argument. Buyer.
Regarding more specifically the news related to cryptocurrencies, it will be recalled that a recommendation to ban cryptocurrencies in the country undoubtedly also frightened investors, after the ESMA, the European regulator, had evoked an earlier this week.
Thresholds to watch this weekend on Bitcoin
From a graphical point of view, it will be recalled that Bitcoin broke below two key supports yesterday: That of $40,000 and that around $37,500. These two thresholds therefore now become the first resistances to be taken into account.
On the downside, the area around $35,000 should be considered the first support near current prices. However, below this threshold, it becomes difficult to find chart supports before the next major psychological threshold of $30,000.
Other cryptocurrencies are collapsing even more than BTC
Finally, with regard to other cryptocurrencies, most show much steeper falls than Bitcoin. Indeed, if at the time of writing this article Bitcoin lost an impressive 8.8%, Ethereum, the second most important cryptocurrency, fell by almost 11%.
The , which stood out at the start of the week with a solid rally of 40%, has canceled all of its gains and more, posting a drop of 11.20% over 24 hours and 12% over one week currently.
But the biggest drop in the top 10 is posted by the , which has fallen nearly 20% since yesterday.
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