Crypto Daily: The Market's Calm Before The Storm
The local support level is now $10,600. This is where the fixing of the chart takes place for the last 6 days. In case of a breakdown of this zone, the price will almost immediately go to $10,200. In this area, an intense struggle between buyers and sellers is possible. The further Bitcoin price trend will depend on its outcome.
At the moment, the most probable is a breakdown of $10,200 downward, with a gradual decline to $9,800. Upon touching the $9,700 zone, we will see a sharp drop to $9,000 and even lower, up to $8,700. Soon followed by a rebound and consolidation above $9,000. This alignment fully fits into the current state of the market, which is very weak at the moment.
In addition, the overheating factor in traditional markets, where a rather large bubble has also matured, is in favor of the decline. This is especially true for the technology sector and the Nasdaq100 index.
Bitcoin has been showing a high correlation with traditional markets lately, so a decline in the stock market could trigger a collapse in the price of Bitcoin.
In theory, this will lead to a drop in the network hashrate and an outflow of miners. This is due to the $9,500 level being the mining break-even point for the most common mining devices. Companies with the most advanced devices and large investments in production will remain on the network.
However, the $9,000 level may not be a pivot point either. Typically, a reversal of a downtrend in the price of Bitcoin is the price crossing the 200-week moving average. This has happened 3 times already, and has always led to a reversal to an uptrend. At the moment, the EMA200 level is at $6,785. This means that the pivot point can be in the $5,500 - $6,500 range.
At the moment, the most probable is a breakdown of $10,200 downward, with a gradual decline to $9,800. Upon touching the $9,700 zone, we will see a sharp drop to $9,000 and even lower, up to $8,700. Soon followed by a rebound and consolidation above $9,000. This alignment fully fits into the current state of the market, which is very weak at the moment.
In addition, the overheating factor in traditional markets, where a rather large bubble has also matured, is in favor of the decline. This is especially true for the technology sector and the Nasdaq100 index.
Bitcoin has been showing a high correlation with traditional markets lately, so a decline in the stock market could trigger a collapse in the price of Bitcoin.
In theory, this will lead to a drop in the network hashrate and an outflow of miners. This is due to the $9,500 level being the mining break-even point for the most common mining devices. Companies with the most advanced devices and large investments in production will remain on the network.
However, the $9,000 level may not be a pivot point either. Typically, a reversal of a downtrend in the price of Bitcoin is the price crossing the 200-week moving average. This has happened 3 times already, and has always led to a reversal to an uptrend. At the moment, the EMA200 level is at $6,785. This means that the pivot point can be in the $5,500 - $6,500 range.