In a flash, Bitcoin plummeted to as low as $8,370 on Tuesday, sinking well below a series of resistance levels in rapid succession.
Currently trading at $8,451 at time of writing, the leading cryptocurrency took a steep 13% nosedive within minutes.
The precipitous fall marks the first time Bitcoin has dipped below $9,000 since June, with all of the major altcoins posting double-digit losses.
In an email to Bloomberg, Jeff Dorman, chief investment officer at Arca, a Los Angeles-based asset manager that invests in cryptocurrencies, writes,
“Price action is being driven by short-term technical analysis right now, as every low price that Bitcoin has bounced off of, and every high price that has been reached has proven to be resistance.
Because crypto is still dominated by short-term focused traders, these telegraphed narratives often become self fulfilling prophecies.”
Analyst and president of the Nakamoto Institute, Michael Goldstein says a further BTC dip below $8,300 is likely based on the stock-to-flow model.
— Michael Goldstein (@bitstein) September 24, 2019
Crypto analyst DonAlt is looking to the 100-day range.
A range of 100 days just broke to the downside.
If this is a bullish shakeout it'll be obvious once BTC reclaims $10k.
If this is bearish I don't want to be long.
Buying this feels like buying $5500 after the $6000 break.
Something I'm not willing to do.
— DonAlt (@CryptoDonAlt) September 24, 2019
Meanwhile, analyst Josh Rager is looking at the 200-day moving average.
$BTC update overview of levels
200 Day Moving Average below along with some heavy support near $8k pic.twitter.com/CpfLSnSNEw
— Josh Rager 📈 (@Josh_Rager) September 24, 2019
The plunge follows Bakkt’s launch on Monday, the new Bitcoin futures trading platform from Intercontinental Exchange, which is being closely watched by the industry.
On launch day, 71 Bitcoin futures contracts were bought at an approximate total value of around $700,000.
Today’s drop also coincides with the upcoming close of CME Bitcoin futures contracts, which has historically triggered a 10% or more drop in the price of Bitcoin.
Traders who predicted today’s big drop blame crypto whales for trying to manipulate the price, with the futures contracts closing out on Friday.