Bitcoin draws a floor that must resist avoiding a new crash in cryptocurrencies

Bitcoin draws a floor that must resist avoiding a new crash in cryptocurrencies

The technical analysis begins to gain strength in cryptocurrencies. At first, this market and its investors reneged on this kind of ‘magic’ that can reveal future movements through the study of past patterns that are reflected in the charts. However, little by little it is seen how bitcoin begins to form technical figures that gain strength and play a fundamental role in the decisions of investors who bet their money in this market.

Bitcoin has been ‘dancing’ above but near $30,000 for weeks, which is leading crypto experts to mark that round number as potential bottom (key support ) for the virtual currency. 

Still, the crypto forecast is fraught with risk, especially since the price of bitcoin is highly volatile and has fallen roughly in half from all-time highs three months ago when it flirted with $65,000. Even so, some analysts in the industry are betting on $30,000 as a great foothold, taking into account the options markets and investor movements.

The $30,000 has become the best-selling falling strike price for July and August in the options market, indicating confidence among such investors that the level will hold, according to Delta Exchange, a crypto derivatives broker.. “It should provide strong support to the market,” CEO Pankaj Balani told Bloomberg.

Investors are also trying to take advantage of price ranges. They wait for bitcoin to fall above the 30,000-32,000 zone to buy and the sale is made in the $34,000-36,000 zone (this resistance was old support), explains Todd Morakis, co-founder of the provider of products and services of JST Capital digital finance, in emailed comments, further assuring that “the market right now seems to pay more attention to bad news than good news.”

Blows to bitcoin

Bitcoin has been hit by many setbacks in recent times, such as increased regulatory crackdown from China, in part due to concerns about high power consumption by crypto miners, and progress on the company’s projects. central bank digital currency (digital yuan) that could spell the end of cryptocurrencies. 

Bitcoin is trading today with slight declines that bring the cryptocurrency closer to the buying zone, according to technical analysis. Right now the price is moving below $32,000. If it bounces from there, the 30,000 floors will gain one point more solidity, but there is a risk that that floor will break and then a new stage of panic begins, leading bitcoin to fall to $20,000. This would undoubtedly temporarily drag down the cryptocurrency market, according to analysts.

Konstantin Richter, CEO and founder of Blockdaemon, a blockchain infrastructure provider, is hopeful that there will be growing institutional demand. If this institutional demand stabilizes and is confirmed, large investors would only lose confidence if bitcoin falls below $20,000, which would be great support after 30,000.

“If it goes down fast, it can go up fast,” he says in an interview. “That is exactly what cryptocurrencies are.” 

However, in recent months it seems that bitcoin is being affected more by bad news than in the past. Furthermore, the good ones (like the acceptance of El Salvador) do not seem to have had as much impact. A move by a central bank or regulator could topple the floor that holds the cryptocurrency market unleashing panic among investors.