Bitcoin price eventually dropped to the $ 7.4K zone in minutes just as we had expected if BTC could not hold the $ 7.8K level.
Over the past week, BTC / USD has faced a slow decline to $ 8,000. Now, King of Cryptos has also broken below its 0.786 Fib retracement level – the recent critical level before a confirmed retreat of October 25 rally to $ 10,500.
After a brief bounce, Bitcoin bounced back around $ 7,100 at the time of writing.
Bitcoin wiped out all October profits
After several days of price action going sideways, BTC / USD finally recorded a decisive drop below $ 8,000, then slipped below its Fib 0.786 retracement at $ 7,870 and plummeted to $ 7,390.
This is the consolidation level before a 42% historical price increase on October 25.
Daily BTC USD chart. Source: TradingView
If Bitcoin drops below $ 7,307, it could indicate that a swing to $ 10,500 on October 25 is just a fluke, leading to a sideways action over the past month. Moreover, the bearish outlook could even indicate that BTC’s recent rally to $ 10,500 is a significant bullish correction despite continuing the overall downtrend.
However, on a bullish note, Bitcoin has not broken the previous low and bounced back to the $ 7,600 area.
Market analyst Keith Wareing meanwhile predicted the fall, pushing BTC to $ 7.4K, and then immediately taking a long position.
“Definitely shortening $ 7,350 is a reasonable move after support on the Bollinger Bands breaks down on all major time frames. Without $ 7350, Willy Woo and Tone Vays would be right, and since it didn’t happen I knew it was the bottom,” he said, and added: “Short closed, now long”.
Short closed, now long pic.twitter.com/MARqRSSUQQ
— ? Keith Wareing (@officiallykeith) November 21, 2019
However, if Bitcoin continues to drop, $ 7,230 can provide a bit of support. Despite that, not much buying power exists before the $ 6K range. If the $ 6k breaks down as easily as it did in the May rally, significant support will exist in the range of $ 5800-5000 when the market has spent significant time in this area since early 2019.
In addition, the MA 200-week moving average (MA) is currently at $ 4,890. At the bottom of the final bear market in 2018, Bitcoin’s 200-week MA has been acting as strong support near $ 3,200. BTC has not closed below MA 200 weeks since 2015.
The crypto market fell due to china?
There are many predictions about Bitcoin’s unexpected price action over the past 24 hours. Many people believe that the market has reacted negatively to the move to suppress Chinese exchanges while President Xi Jinping had previously made a positive view on Blockchain.
China’s Shenzhen, often dubbed as ‘Silicon Valley’, has introduced new controls on cryptocurrencies and exchanges through the creation of a legal framework. Agents in this city, according to the report of the co-founder of Primitive Crypto, Dovey Wan.
JUST IN
Shenzhen follows Shanghai step to further strength regulatory control over illegal cryptocurrency trading and pump and dumping https://t.co/a6ntYxNP3A pic.twitter.com/Dv8iDagi7u
— Dovey 以德服人 Wan ? ? (@DoveyWan) November 21, 2019
In addition, there were rumors that the Chinese authorities raided the Shanghai office of crypto exchanges.
According to the report, citing unnamed local sources, local police closed Binance’s office after raiding facilities, forcing many executives and about 50-100 employees of this floor must work remotely or move to Singapore.
The raid purportedly follows a crackdown on domestic crypto-related activities.
However, Binance said that the company has not yet received notice that financial institutions in China have issued a notice to the public, directing individuals to report businesses involved in trading virtual assets for Shanghai headquarters of the People’s Bank of China – the central bank of this country.
A Binance spokesman dismissed media reports that Chinese police raided and then closed the exchange’s Shanghai offices. Furthermore, the spokesman stated that not even such an office exists:
“The Binance team is globally active, including people working in a decentralized way anytime anywhere in the world. Binance doesn’t have a permanent office in Shanghai or China, so the information that the police raided on any offices and closed them in China is not true”.
The spokesperson also stated that Binance is being targeted on Chinese media, and added that there has been a sudden surge in the number of negative articles and activities against Binance coming from the continent.
Last month, there were many rumors that Binance is planning to open an office in China’s capital, Beijing, although the country has decided against cryptocurrency.
However, according to CEO Changpeng Zhao, offices themselves are an outdated concept. In a tweet on November 20, Zhao stated:
“Office and HQ are old concepts like SMS and MMS. Time is moving on…”
Office and HQ are old concepts like SMS and MMS. Time is moving on…
— CZ Binance (@cz_binance) November 20, 2019
There were also rumors that Chinese authorities raided Bithumb’s Shanghai office.
However, on November 21, a Bithumb spokesman announced that the recent rumors of a police raid and the closure of offices in Shanghai were not true and that one and only one Shanghai team continued to operate stably without a pause.
Bithumb also denied reports from the Chinese media that the Korean exchange had given its employees a long holiday, without notifying them about any particular day when back to work.
The Reddit community has responded to these rumors. Most notably, Redditor Pmayall thinks it is just FUD, it is spread because the dying web shit wants to get more traffic by publishing fake news.
Despite this, the crypto markets still reacted negatively to the rumors, with most of the major currencies seeing significant losses throughout the day. The $ 179.3 million long order was liquidated on BitMEX, the world’s leading margin exchange, after the price of Bitcoin plummeted to $ 7,350.
Cryptocurrency market visualization. Source: Coin360
Disclaimer: This is not trading advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.
Read more:
- Bitcoin’s Nearest Potential Buying Zones Can Provide Trend Reversals, Will Parabolic Trendline Visit Spark Price Movement?
- Why Moving Average Isn’t Your Average Indicator?
Annie