Bitcoin Price Prediction: BTC Has Dropped By >$7,500 Over The Last 5 Days
Daily Bitcoin BTC Technical Analysis
- Bitcoin has dropped by nearly 20% over the last five days.
- The MACD has reversed from bullish to bearish during this downward spiral.
Bitcoin has dipped considerably over the last five days, crashing down by more than $7,500. As of now, the price is floundering a little above $32,500. Is a crash below $30,000 in the cards? Let’s take a look.
BTC Drops By Almost 20%
Bitcoin has successfully flipped the $38,000 and $35,000 barriers from support to resistance. As of now, the premier cryptocurrency is sitting on top of the 20-day SMA. However, it doesn’t look like this level is going to hold. The MACD has reversed from green to red, which shows that the overall market momentum is bearish.
Image: BTC/USD daily chart
When Bitcoin breaks below the 20-day SMA, it will face two healthy support walls at $31,000 and $29,000. At the former level, 337,000 addresses had purchased 250,000 BTC tokens. This seems like a strong enough level to absorb quite a bit of selling pressure.
The 50-bar SMA has crossed over the 20-bar SMA to form the bearish cross pattern in the 4-hour time frame. This could signal that a further drop is in the cards. As per the parabolic SAR, the overall market sentiment is on the verge of reversing from bullish to bearish.
Image: BTC/USD 4-hour chart
Bitcoin Whales Keep Buying The Dip
Amid Bitcoin’s sudden correction to a little over $30,000, it appears that many whale addresses are accumulating the asset. BTC prices dropped by 23% recently following the token’s surge to an all-time high close to $42,000 over the weekend. However, whale addresses have displayed accumulation behaviour, indicating large investors are buying the present dip.
Wallet addresses with more than 1,000 BTC have continued to grow despite the sudden drop in valuation, as per data presented by researcher Elias Simos. Simos concluded that whales were “gobbling” up Bitcoin during a panic sell generated by retail investors.
Market data shows a 4% increase in whale addresses since December 2, while the number of smaller addresses (less than 0.01 BTC) has fallen by more than 6%.
Analyst Lark Davis recently warned BTC investors that they should avoid becoming “whale food” during the dip. According to him, large investors are shaking the market while shorting it to make a profit.
PayPal Hosts $242M Crypto Trading Over 24 Hours
Payments giant PayPal has doubled its previous cryptocurrency volume record, with $242 million worth of virtual assets changing hands on the platform recently. The payments company seems to be getting more popular among retail traders as the company’s recent volume record is taking place amid Bitcoin’s ongoing price rally.
A Twitter user Toomas Zobel speculated that the volume surge has probably resulted from retail capitulation, as per a Cointelegraph report.
Many in the cryptocurrency community have praised PayPal’s entrance into crypto as it is driving new users toward digital assets. However, several others have criticized PayPal for creating a “gated” cryptocurrency community that does not support withdrawal functionality.
A Twitter user Toomas Zobel speculated that the surge in the volume has probably resulted from retail capitulation, as per a Cointelegraph report.
Is there a way to view whether this was buy or sell volume? In this huge dump, it may just be retail sellers capitulating rather than creating buying pressure.
PayPal’s crypto services are accessed via Paxos’ ItBit exchange.
Mark Cuban: Bitcoin Is "A Store of Value"
Mark Cuban, a billionaire entrepreneur, and investor, recently shared his views on the crypto market. In his opinion, a few digital assets like Bitcoin, Ethereum, and some altcoins will manage to survive the current speculative bubble just like startups such as Amazon and eBay survived the dot-com bubble while the rest failed.
Cuban noted that “crypto, much like gold, is supply and demand-driven.” When asked about Bitcoin (BTC), he said that he thinks of it as “a store of value,” adding that it has “no real utility”.
In December 2020, Cuban had taken to Twitter to announce that those using BTC to buy Dallas Mavericks merchandise would get a 25% discount. Cuban is the majority owner of the professional basketball team Dallas Mavericks.
According to a Blitz Weekly report, the Mavs have been accepting Bitcoin as a means of payment for game tickets and merchandise for the past year and a half. They use BitPay to process Bitcoin payments.
Key Price Levels To Watch For BTC
The price of bitcoin at $31,000 support barrier is absolutely crucial in the overall outlook of the price chart. If the price of Bitcoin breaks below this zone, the parabolic SAR will reverse from bullish to bearish in the 4-hour chart and prompt a break to the $29,000 level.