Bitcoin continued to fall on Wednesday, and by 12:24, it had fallen below the $40,000 per coin mark for the first time since Feb. 8, retreating about $25,000 from its all-time high. Then, by 12:44, bitcoin fell below $39,000 per coin, extending its intra-day decline to 9%. Meanwhile, ethereum fell below $2,890 per coin, down 14.52% intraday. As of 12:52, Dogcoin lost $0.40 per coin, extending its intra-day decline to 20%.
At the moment, Bitcoin is not only losing Musk’s “favor”, but is also facing a number of negative news clutches.
On the evening of the 18th, the central bank issued a document and the three major associations of the financial industry spoke out: virtual currency trading services are suspected of carrying out illegal financial activities and will strengthen the regulation of the cryptocurrency market.
On Tuesday evening, Bank of America released the results of its latest monthly survey of fund managers, showing that close to 45% of surveyed fund managers believe the most crowded market trade in May was going long on bitcoin, a significant pickup from April’s 27%. In the January survey, being long bitcoin was once recognized as the “most crowded trade”.
On the technical front, technical analysts have previously suggested that bitcoin could fall below the $40,000 mark.
Rich Ross, an analyst at Evercore ISI, believes that, similar to the price action of other speculative assets, bitcoin is destined to fall below its 200-day average and back down to $40,000.
Other analysts believe bitcoin will fall even lower as Musk’s elusive tweets will discourage traditional investors from investing in the more stable asset of gold.
Michael Purves, CEO of Tallbacken Capital, accurately predicted bitcoin’s decline last month. He notes that more and more investors have now become bearish on bitcoin.
Bitcoin has risen 300% since May of last year. But recently bitcoin has started to fall wildly, and the price has dropped about 30% compared to its intraday high of $64,000 in April. This has dissuaded a lot of investors who wanted to get in on the new scene. People can’t help but start to wonder if bitcoin can become a mature and stable asset.
Purvis predicts that if bitcoin falls below the $42,000 mark, it will trigger an even bigger drop; if not, bitcoin will have a good chance of rebounding.
Justin Chuh, a senior trader at Wave Financial, said.
“While none of us want to see this happen, it’s normal for bitcoin to fall right now.”
Analyst David Grider of Fundstrat Global Advisors, on the other hand, takes the opposite view. In a report released Monday, he cited nine reasons why bitcoin will rebound, such as the fact that there are currently enough shorts and that such short-term corrections are normal in this cryptocurrency frenzy. grider also wrote.
“We believe the bitcoin price is near a short-term bottom and advise investors not to panic too much and start selling bitcoin.”
Anchorage Digital Bank is a company that provides a digital asset trading platform for institutional investors. Its co-founder, Diogo Monica, said clients are still increasing their cryptocurrency holdings because they think “now is a good time to buy.”
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