In the late hours of yesterday, Twitter was again the bearer of the crypto news of the day: A whale transaction alert started circulating and it was right before the beginning of the biggest drop we’ve experienced in Bitcoin – and consequently the whole market – in the last few weeks, since the upwards rally began.
This is the beauty of the blockchain, all transactions are public, therefore something like 25,160BTC ($213,365,390 USD) that were moved from a wallet to Coinbase, could not pass unnoticed.
This is not the first time that such moves affect the market drastically, unfortunately negatively as a norm, revealing some bull weaknesses after the massive rallies we’ve seen in the last month.
In a matter of only two hours, Bitcoin price dropped by $700, reaching a bottom of $7,778, marking a fall of over 10% in just a few hours.
The next couple of days will be crucial to understand if Bitcoin will survive the crash and go back to its $8500 resistance level or drop more to the support line of $7700.
All other cryptocurrencies followed suit with EOS recording the biggest drop of 12% in the top ten, while ETH, LTC, and BCH all saw a drop between 5 and 10%. The total market capitalization has also been hit with a loss of $16 billion in one day.
At the time of writing, BTC is recording a slight recovery from yesterday’s crash with its price now at $7,975. Will it be able to hold and rise again to reach the crucial resistance level of $9000 this time?
We said several times that this market is totally unpredictable although a considerable correction had been expected for weeks, since the beginning of the rally at the end of April. The reason being that after a fast and unstoppable uptrend as this happened, historically there’s always been a consequent drop with the most notorious episode happening in December 2017.
Therefore all major experts were expecting a correction sooner or later. Most are expecting BTC price to go as down as support level of $6750, some even further down to the $4600 range. They predict this is very healthy for Bitcoin as it means it is consolidating around the $5500 range before taking a new rally, this time even higher to the $12K range with some even calling $25K with the next run.
We are more cautious and keep observing what’s happening. We mentioned already that the best advice is to be in a good position whether the price goes up (you’re happy with your crypto positions) or down (you’re happy to buy more). Happy trading!