Bitcoin is on the verge of a massive breakdown after losing a crucial support level. The pioneer cryptocurrency was rejected $38,000 again, opening the Pandora box. A gust of wind is swimming across the cryptocurrency market, mainly accentuated by BTC’s drop under $33,000.
At the time of writing, Bitcoin is doddering at $32,800 amid the uphill battle to keep the price within the confines of the descending triangle pattern. If the buyer congestion at this level is dispersed, we can expect the price to explore lower levels; first at the 200 Simple Moving Average and perhaps the former support at $30,000.
The pessimistic outlook appears to have been validated by the Relative Strength Index’s freefall toward the oversold area. Similarly, more downside action will come into play if the 200 support fails to hold. Additionally, if investors start panic selling, the bearish leg is likely to overshoot the primary support at $28,000 and make an approach toward $25,000.
BTC/USD 4-hour chart
Investor sentiment has remained high despite Bitcoin’s retreat from $42,000 (an all-time high). This is evidenced by Grayscale Investments’ additional purchase of Bitcoin. The largest digital asset manager in the world has made two gigantic investments to its Bitcoin Trust in less than two weeks. In the first purchase, the company spent 509 million to buy BTC while in the second, it took advantage of the dip to $34,000, purchasing 8,000 more BTC.
The extend of the ongoing bull run is unknown but retracements are common in markets like these. Therefore, the dip could be an opportunity for investors to enter the market or increase their positions. However, it is advisable to wait for confirmation of a rebound before going all-in on Bitcoin.
Bitcoin intraday levels
Spot rate: $32,800
Relative change: -2,270
Percentage change: -8%
Trend: Bearish
Volatility: High