Bitcoin has dropped by 1.1% within the past 24 hours. It is currently trading below $30,000. The king crypto's fall below this key price level has sparked some tension in the market.
The coin suffered bearish blues on Monday, dropping to as low as $29,679. This is against last week's general gains as a result of the XRP ruling.
Although it still dominates the market share, Bitcoin has dipped in its recent performance. Since the turn of the year, its instability has led to mixed reactions from investors and traders alike.
Bitcoin has been hovering around $30,000 for the better part of a month. Let us consider some reasons why;
While the partial victory of XRP led to gains in the market, it didn't fully ease investors' minds. This is because the court ruled that the sale of XRP didn't violate securities laws, but it didn't point out whether it was a securities offering.
Consequently, almost a week after the ruling, most coins have dipped. BTC, ETH, SOL, BNB, and even XRP dropped.
There is also the case that Binance has with the U.S. Securities and Exchange Commission. Since then, the crypto exchange has laid off 1,000 workers, with some essential executives also departing.
Its ongoing legal issues with the SEC were reported to have been the reason. However, it has tried to maintain a firm stance, with the CEO claiming the company plans to "increase the talent density."
On-chain analysis platform Crypto Quant insinuated that a primary reason BTC hasn't made a significant breakout is speculative trading. Short-term holders have deprived themselves of their holdings since April, which increased selling pressure above $30,000.
"This indicates that short-term investors are actively liquidating their assets, thereby locking their profits."
Secondly, the BTC market has been said to be in flux by on-chain analyst Material Indicators.
Another analyst simply called BTC price action boring.
The macroeconomic space has not been kind to Bitcoin. There are also speculations that there could be a further increase in the Federal Reserve rate.
For context's sake, the Asian market has been declining, as seen in the Tether (USDT) premium. The Asian Tether premium recently reached a discount of 1.8% — its lowest point in over six months.
Also, China's GDP growth unexpectedly slowed to 6.3% in Q2. This was attributed to its ongoing trade issues with the U.S. and the government's efforts to deal with debt.
Famous Twitter analyst Shayan thinks examining the futures market would provide essential insight into the crypto market.
The Bitcoin buy-sell ratio chart depicts a vital indicator of the intensity of long and short positions.
Recently, the metric has been fluctuating below one without a significant recovery in sight. The short positions push downward pressure on the price in the short term.
This means that futures traders generally retain a pessimistic viewpoint on the coin.
In addition, he opined that from the Bitcoin daily chart, there is a double-top pattern near the significant resistance region of $30k.
The BTC price is facing considerable dynamic resistance from the middle trendline of the ascending channel. These have been said to hinder its price from increasing for months.
With all of these, Bitcoin's place in the $29,000-$30,000 mark means the bulls haven't relinquished control yet.
BTC options market indicates that investors are paying a premium for the coin that works out in the event of an upside. This points to a dominant sentiment that its long-term prospect is positive.
Furthermore, its funding rates on major crypto exchanges like Binance, Bitget, and OKX are positive. This suggests that traders are open to paying more to long the coin, anticipating a price increase.
Finally, Glassnode speculates that the price can recover with steady flow.
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