Bitcoin lost its grip on the $11,000 psychological support level to sink into the $10,000 level quickly. This rapid decline comes with correction and profit taking activity in the digital market after Bitcoin hit a 17-month high at $13,900.
Market analysts were Q8 Trade They are expecting a 40% corrective move, and it appears that the current price of Bitcoin has now reached the target level of the corrective move.
Since the beginning of this year, the cryptocurrency has risen nearly three times, a move that is quite unlike the rally of 2017, where the current rises of cryptocurrencies are being led by institutional investors rather than retail traders.
Bitcoin under pressure from corrections
Beginning on June 11, Bitcoin saw a two-week rise in value, hitting this year's high of $13,900, and some analysts attributed the upward move to a variety of bullish factors that were interpreted as showing broader acceptance of cryptocurrencies in general, including Facebook plans to launch its new digital currency, Libra, or the recent regulatory approval of the Bitcoin futures contract, Ledger X, while others worry that the sudden and rapid rise is reminiscent of the 2017 boom that saw a frenzied rise to nearly $20,000 before It drops to nearly $3,000.
Over the course of trading in June, the bitcoin currency managed to record gains of about 26% for the fifth consecutive month, making bitcoin the longest monthly rise since April 2017.
With the end of the second quarter of this year, Bitcoin recorded gains of about 163%, recording the second consecutive quarterly rise, and it is also the largest since the fourth quarter of 2017.
Bitcoin plunged to the level of $ 10,000 and failed to stay afloat in the face of extreme volatility, with the recent decline predictions of a deeper price decline have been renewed after recent record-breaking activity, especially since overbought has occurred that may lead to deflation for several weeks.
Among the reasons that confirm the occurrence of more declines is the usual behavior of Bitcoin, in the sense that profit-taking operations create a state of panic among investors, as a result of which intensive selling occurs, and thus prices fall rapidly.
Another reason is the crisis of confidence surrounding Tether, which may cause price tensions. In October 2018, the loss of Tether’s peg to the US dollar, in addition to doubts surrounding the source of the stablecoin, led to a continued decline in prices, with Bitcoin losing about 50% in value. From a low of $6000 to a low of $3,200, in 2019 it became clear that not all of Tether was fully backed by the US dollar, and in June alone about 500 million coins were minted.