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Fear reigns supreme as Bitcoin falls below $40K but recovers lost ground

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  • Experts, however, predict an impending bearish phase
  • Fear factor affecting the performance of 29 out of 30 top crypto assets
  • $40 K resistance level is essential and must be maintained

There is unison in views that Bitcoin will reach six figures if the support level at $40,000 can withstand the pressures. However, there is no shortage of experts who are predicting an impending bear cycle. A feeling of sudden fear swept through the Bitcoin Community when the price of Bitcoin slumped below $40,000 for the first time in six weeks.

The tanking of prices happened at the fag end of September 21. Bitcoin prices tanked by 16%, from $47,300 at the start of the day and fell to $39,650 at 9 pm UTC. It also represents a fall of 25% from the local all-time high of $50,000, which was reached on September 7.

It is to be noted that the pullback happened after a spectacular surge of 80% by BTC since it reached its nadir of $29,300 on July 20 and was heading towards the September peak. However, BTC had recovered and was trading just above $41,990.36 when the last reports came in.

The malaise has not hit only Bitcoin but has been a universal phenomenon, and according to CoinGecko, 29 of the top 30 crypto assets suffered 24 hours tanking in prices.

Another benchmark Crypto Fear and Greed Index hints at the start of a bearish phase precipitated by an underlying fear that has spread across the market. Last month the metric was hinting at ‘extreme greed’ sentiments.

Crypto sceptics have seized the opportunity to prove the inevitable tanking of the markets, and “Mr Whale” has predicted that the bearish phase is here to stay.

Another infamous bullion shill Peter Schiff chipped in and gave his views on the crypto market. According to Peter, the altcoins will grow and soon reach a stage where the demand will outpace supply. When the crypto bubble pops, the credit woes of Chinese real estate giant Evergrande will threaten Tether’s reserves and the broader crypto markets through systemic risk.

The tanking of prices also comes after statements by SEC chairman Gary Gensler who compared stablecoins to poker chips and asked for a further tightening of controls on the crypto market as a whole. However, the crypto community on Twitter believes that the dip is in response to the market action. Bitcoin is all set to make a recovery should the values stick above local support.

Galaxy Digital CEO Mike Novogratz spoke to CNBC, and he said that he is not worried until BTC holds above $40K and ETH falls below $2,800. If the prices are at these levels, the market is in a healthy state.

Novogratz is not alone in considering $40,000 as a critical level for Bitcoin, and experts believe that Bitcoin is unlikely to fall below $39,000 due to its liquid supply floor and “real-time scarcity.”

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