The cryptocurrency market managed to recover since hitting its bottom in July 2022. However, the previous week was a bad one for the cryptocurrency market. Most cryptos are down by more than 12% on average. Bitcoin, which is the biggest cryptocurrency by market cap also has an average loss of 12%. This is natural as BTC still has a dominance of around 40%. After such a price drop, many investors fear that the market is going to go back bearish. Will Bitcoin price recover? In this Bitcoin price prediction article, we’re going to analyze BTC prices from a technical standpoint.
Why is Bitcoin Down?
The abrupt price changes have no obvious basic causes. However, it is evident that the majority of cryptocurrencies were on an upswing prior and made large gains during the preceding several weeks. However, prices have just started to retrace lower.
Some experts believe this is the result of a significant selling transaction, while others believe it is the result of profit-taking. Furthermore, “snowball effects” are rather typical in the cryptosphere. This is when a little sale event lowers prices, which is followed by FUD, which also lowers prices, which is followed by market panic, which further lowers prices.
Bitcoin Collapse: BTC price back to 20K?
When the market started to move lower, Bitcoin made a clear move and broke its uptrend. In figure 1 below, we can clearly see how the uptrend was broken. For day traders, that was a clear indicator to liquidate any open BTC position, as this would lead to a further decrease in prices.
When BTC prices fell, they reached the next support area. This area played a resistance and support multiple times in the past price action of Bitcoin. We can also see in figure 1 how the price of $21,100 played an important role in sustaining prices in either direction. That’s why prices might consolidate in the next short-term.
Bitcoin Price Prediction – Will Bitcoin Price Recover?
Currently, BTC prices are in a very critical area. If Bitcoin goes lower than the price of $20,700, we expect prices to sink further down towards the psychological price of $20,000. Prices can even go back lower towards the strong support price of $18,500. It all depends on the general sentiment in the crypto market.
Additionally, some fundamental macro events are affecting cryptocurrency prices, such as the US interest rates and the war happening in Ukraine. Those two factors might contribute in the short/medium term to lower crypto prices.
On the other hand, Bitcoin did a similar price drop towards the $21,100 price and rebounded higher. This might be the current case, but the rebound would be slower than the previous move. We don’t expect to see Bitcoin regain +10%, especially with the current market dynamics. For now, it’s important to keep an eye on Bitcoin prices as it’ll affect the crypto market as a whole. Make sure to follow us on Google news to stay updated on the latest crypto price developments.
The Crypto Market at a Glance
In the past 24 hours, most cryptocurrencies lost an average of 2%. The top performers are EOS, Chiliz and Litecoin gaining respectively 12%, 10%, and 3%. However, the top losers in the past 24 hours were Celsius, Lido DAO, and Trust Wallet Token losing respectively -28%, -12%, and -7%.
1- Bitcoin (BTC): – 0.86 %
2- Ethereum (ETH): – 2.96 %
3- Tether (USDT): 0 %
4- USD Coin (USDC): 0 %
5- Binance Coin (BNB): – 0.51 %
6- Binance USD (BUSD): 0 %
7- Ripple (XRP): – 2.35 %
8- Cardano (ADA): – 3.20 %
9- Solana (SOL): – 4.98 %
10- Dogecoin (DOGE): – 2.56 %
