Following the recent 2019 high for the number one cryptocurrency, Bitcoin dropped by 4 percent and in the latest cryptocurrency news today we find out why.
Bitcoin reached $5,540 only 12 hours ago but it dropped soon after despite the increased demand for the currency from investors. Also, the Bitcoin Investment Trust premium which is a cryptocurrency investment company that has about $1.2 billion under management, increased by 10 percent.
As you can see from the charts, the bitcoin priced went down from $5,400 to $5,200 in less than 12 hours and is currently trading at $5,058. On a daily basis, the largest cryptocurrency by market cap decreased by 1.2 percent and on the weekly charts, we can see that the asset is still up by 6.8 percent.
According to the price analysis, over the past 14 days, when bitcoin started the 20 percent rally, it showed slight retracements from 1 to 5 percent range. It started the rally at $4,200 and reached $5,000. On April 4th, Bitcoin reached $5,261 but it soon fell down by more than 7 percent.
The price analysis shows that Bitcoin is likely facing some issues after starting the upside movement because of the resistance levels hovering above the currency above the $5,000 region.
Technical Analyst Luke Martin believes that the $5,500 price point is a relatively strong resistance level and that the asset should be able to recover above $6,000. He noted:
“For the first time since $1,000 BTC breakout on Apr 1st, [the bitcoin] price is reaching an area that I expect to act as resistance. It’s the only area price paused at after the dump from $6,000.”
Since the price of BTC dropped after reaching the resistance level at $5,500 it seems like the asset will need strong catalysts to boost it past the level and reach to the $6,000 region. In the short-term, if institutional investors decide to pour their capital in bitcoin, the demand for Bitcoin will go up and so will its price.
Also, in the medium-term the recent developments in the crypto industry such as Coinbase issuing its crypto debit cards, could further raise the confidence for the crypto sector from investors.
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