Crypto analysts are reacting to Bitcoin’s sudden drop below $10,000.
Josh Rager tells his 55,000 followers on Twitter that Bitcoin needs to stay above $9,533 on its weekly close this Sunday to prevent another significant move to the downside.
“BTC is going for it’s 3rd down week in a row. Last uptrend Bitcoin has multiple months with at least three down weeks in a row.
Price is near weekly support and on weekly perspective, I want to see BTC close above $9533 Sunday or it would form a lower-low. Monthly chart looks ugly too.”
Fellow analyst DonAlt tells his crew of 118,000 that Bitcoin’s weekly chart is still “reasonably bullish” – but he’s buying the dip.
Analyst and Forbes contributor Brendan Coffey says CME’s Bitcoin futures contract, which settles on Friday, could be playing a role in the pullback.
“[Bitcoin’s] plunge isn’t necessarily a critical blow. It could be a rope-a-dope to shake out some traders and buy cheaper. After all, I’m not the only one who studies chart patterns – plenty of big traders do too, especially in Bitcoin which isn’t saddled with additional complexities you see in equities created by index funds and large mainstream investment fund buying.
It’s very common in other assets, futures especially, for big traders to force a move to trigger sell-stops in a contrarian method to build a stronger base for a bull move. In short, there’s more than one possible explanation right now.”
Meanwhile, chief investment officer at Arca, Jeff Dorman, tells Bloomberg low trading volumes are partly to blame.
“It’s the week before Labor Day. Half of crypto is at Burning Man and the other half is sitting on their hands doing nothing.
Volumes are low and it takes very little to move markets right now, and you have big futures/options expirations coming up at the end of the week.
The only definitive thing I can point to is that the move was led by declines in EOS, ETH, XRP, BCH, LTC and other large-cap tokens that have been out of favor for months. I just don’t think there are a lot of investors willing to defend price right now.”
Bitcoin is down 5.81% at $9,580 at time of publishing, according to CoinMarketCap.
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