The cryptocurrency market’s recent period of sideways trading and relative stability ended today after Bitcoin failed to hold above its support level that existed in the low-$3,500 region. Bitcoin’s drop led the entire crypto markets to plunge, and many altcoins are currently trading down well over 5%.
Analysts have mixed reactions to the latest leg down, but mostly concur that Bitcoin will likely revisit its December of 2018 lows around $3,200.
Bitcoin Still in Wide Trading Range Between $3,000 and $5,000
At the time of writing, Bitcoin (BTC) is trading down nearly 4% at its current price of $3,460. Over the past week, Bitcoin has been caught in a trading range between $3,550 and $3,650, with the former price previously being a level of relative support for BTC.
Although today’s drop removed the support BTC previously had around $3,550, Bitcoin is still well within the large range that has been discussed in previous Covesting market updates.
Mati Greenspan, the senior market analyst at eToro, discussed Bitcoin’s trading ranges in an email earlier this month, importantly noting that on a wider scale, Bitcoin is currently caught in a trading range between $3,000 and $5,000.
Greenspan reaffirmed his belief in that wide trading range while speaking with Business Insider earlier today, saying:
"The cryptoasset movement today is nothing more than technical… There’s no need for overreaction here. Bitcoin is continuing to trade within the core area of support between $3,000 and $3,500, within the broader range of $3,000 - $5,000, where it’s been since November 2018.”
Analysts Have Mixed Opinions Regarding Where Bitcoin is Heading Next
Although Greenspan believes that all movements in the aforementioned range are simply noise, Alex Krüger, a popular cryptocurrency analyst on Twitter, recently shared a more bearish sentiment, noting that BTC is likely to see a continuation of its selling pressure until it reaches its December lows around $3,200.
“I see no support until the December lows. I'd only look at longs if planning to scalp (and scalping against a trend is not an enjoyable experience),” he said.
Luke Martin, another popular analyst, recently shared his thoughts regarding Bitcoin’s recent price action, noting that it could see a bounce if it is able to end the day above $3,430.
“$BTC moving below 3430 swing low level triggering selling pressure for most alt imo. Starting with large caps & also erasing positive moves for most mid-caps last 30 days… If daily closes back above 3430, chance we see macro bounce. Close below & I am looking for 32/3100 area,” Martin explained.
John Kelvin, Covesting’s cryptocurrency analyst, shared his thoughts in a recent post, noting that in the near-term, BTC/USD is likely going to target $3,285.
“The rejection wick still making the breakout and the body of the candle sticks are yet to close outside the flag. A close of the body below the bearish flag is a signal to open a short trade… With the measurement of the pole (price move down), the target for this move is pointing at $3285,” Kelvin explained.
Altcoins Plunge
Bitcoin’s inability to maintain above $3,500 has led virtually all major altcoins to sink.
At the time of writing, Ethereum (ETH) is trading down over 8% at its current price of $105. Ethereum has not yet broke below $100, but if Bitcoin forms another downwards leg a test of this support level is highly likely.
XRP is one of the better performing altcoins today, as it is trading down just over 5% at its current price of $0.292. XRP was unable to hold above $0.31, where it previously found some buying pressure.