In a previous Bitcoin price prediction article, we showed 3 potential price targets for Bitcoin over the short term. We analyzed how Bitcoin faced a resistance area, coupled with bad fundamental news surfacing in the market. After a week, 2 out of the 3 targets were hit, with the 3rd being on the way. What happened to Bitcoin and why is Bitcoin crashing? Let’s analyze further.
Bitcoin Price faced a Resistance
After an extensive uptrend from a low of around $17,000, Bitcoin prices reached a resistance of $24,000. Prices could not break this area higher, which is why we assumed a retracement lower. Using the Fibonacci retracement, we delimited the following price targets:
- Normal case: $22,222
- Worst case: $21,196
- Extreme case: 20,371
In fact, this is exactly what happened since our last prediction, with Bitcoin’s current price hovering around $21,640.
Why is Bitcoin down today?
Well, there are many factors that contribute to the crash in the current crypto market:
- From a technical perspective, prices were bound to retrace after an extensive uptrend from the low of $17,000
- From a fundamental perspective, there is a lot going on in the market. However, the biggest being the SEC striking again as Paxos was ordered to cease minting Binance stablecoin. This comes after Binance halted withdrawals.
- The judge that is on the FTX case extended SBF’s bail restrictions, adding question marks to the resolution of the collapse’s timeline.
Bitcoin Price Prediction: Will Bitcoin reach $20,000?
If things continue to go south, we expect Bitcoin to reach the third target which we set in a previous article. If Bitcoin breaks the price of $21,200 lower, we should see Bitcoin between $20,000 and $20,385. Until there’s a resolution in sight, things might drag and the crypto market cap will continue to hover around an aggregate valuation of $1 trillion.
It is advised to wait before opening any long crypto position, as the market should continue to go lower in the coming days.
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