Despite the promises of cryptanalysts and organizations such as Goldman Sachs, the price of bitcoin continues to fluctuate at the level of 5 digits. What's the matter?
After trying to hold above $ 11,000 earlier this week, Bitcoin’s price finally yielded to pressure from sellers and fell below $ 10,000 a second time in three weeks. Before the fall, many analysts predicted that 10 thousand dollars would serve as a reliable point of rebound, since the price is an important psychological support.
Obviously, this is not the case, and even after a strong increase from $ 9,500 to $ 10,450, Bitcoin is still trying to stay above $ 10,100.
Let's see what holds the king of cryptocurrencies.
Dovey Wan says Ponzi scheme destroys crypto market
July 14, Founding Partner of Primitive Crypto Dovey Wang attributed A sharp correction across the entire Bitcoin market is selling from PlusToken, the Chinese Ponzi scheme. The scheme managed to accumulate 200,000 bitcoins and more than 800,000 Ethereum from naive investors in China.
According to Wang, not all PlusToken team members have yet been arrested, and data from Peckshield, a cyber security audit firm, show that more than 1,000 bitcoins have recently been transferred to Huobi and Bittrex from PlusToken accounts.
Wang is convinced that fraudsters secretly transfer their funds "in small batches to exchanges, for example, from 50 to 100 bitcoins per lot." Wang also stated that she recently stumbled upon a chat where Chinese traders said that someone was resetting 100 bitcoins without stopping at Binance.
If this is true, it is possible that large mutual sales of Bitcoin may affect the spot rate on exchanges, but this is the only event that probably does not bear full responsibility for Bitcoin's malaise.
Watch out for CME
CME Bitcoin Futures the gap Another popular topic among Bitcoin traders, and many cite the gap as the reason Bitcoin continues to fall below $ 10,000. A look at the daily Bitcoin chart shows a gap of $ 870 between $ 7,177 and $ 8,050.
A gap is simply the result of a change in Bitcoin prices on weekends when CME futures are closed and a space indicates the difference between the previous close and the new open price as soon as the market opens again.
The gap is cause for concern, as traders set the price as a target that needs to be filled at some point, usually when the asset is adjusted and returns to support levels near the gap.
Many traders believe that Bitcoin needs to redefine the range from $ 7,100 to $ 8,500 in order to truly fix it before resuming its strong bull trend to a new record high of 2019.
The accumulation of bitcoins before the growing fear of recession
The assortment of cryptanalysts has sent graphs showing that Bitcoin has entered a long consolidation phase and will continue to be in the range of $ 9,000 to $ 14,000 until there is more excitement and momentum compared to the double event in 2020.
Earlier this week, when the stock market experienced a terrifying recession due to weakening key macroeconomic indicators, concerns about a recession arose as the economist focused on the inverted Treasury bond yield curve.
This week, the decline in US Treasury bonds has been reversed, and for economists and market analysts, this is usually an indication that a recession may come.
At the same time, gold continues to rise in price, and many investors believe that Bitcoin is a similar means of preserving value and protecting against volatility.
If the United States and other countries were really on the verge of a recession, it would be possible to increase the influx of bitcoins and significantly increase its market capitalization and value.
At the time of this writing, Bitcoin has been steadily declining to $ 10,000, and $ 9,800 is the most immediate level of support.
Do you think the price of bitcoin will fall below $ 10,000 on the weekend? Share your thoughts in the comments below!
Images from the Bitcoinist, Twitter image library: @DoveyWan, BTC / USD charts from TradingView