Corrections are normal, but Bitcoin’s “terrible” drop in prices could prolong if this support is lost

Billionaire Mike Novogratz believes Bitcoin’s “terrible” decline this week is no surprise.

The top coin fell 17% in value on Tuesday to $ 43,050, its lowest level in nearly a month.

follow interview The CEO of digital asset company Galaxy Digital, new to Bloomberg TV, said Bitcoin was overbought due to a number of fundamental factors and positive news that caused hype among investors.

“The market is too hot for good reasons. I think in the past 8 weeks, crypto in general, and not just Bitcoin, has been bought as a hedge against weak monetary and fiscal policy, but perhaps more importantly Web 3.0. It is the internet that transmits values ​​…

When you see companies like Visa buying NFTs and claiming that digital goods are a huge part of the future, or Walmart and Amazon, the world’s two largest retailers, are stepping up their support for science engineers and cryptocurrency professionals, it’s important to realize that This is a technology game and no investor wants to miss out on the next internet. This is the next internet. “

Source: Mike Novogratz

Novogratz said that while it is difficult to predict the short-term movement of the crypto market, its long-term development is easy to see.

“Just look at the 12- or 15-year long-term bitcoin price chart and think about the pace of adoption around the world. You know it’s a property now. It’s a store of value …

Stan Druckermiller also says it’s an asset. He’s literally the best investor we’ve seen in 30 years. At the same time, there are many institutions that have stated that they believe in Bitcoin as a store of value. “

Trader Lark Davis is also unimpressed by the sudden slump in Bitcoin.

BTC is down nearly 20% from a local high of $ 52,900 in one day after building continuously higher levels of support during the bull run since July.

In one Update session Davis stressed that sudden price changes in cryptocurrencies are normal.

Source: Lark Davis

“If you’re new, we really need to talk about it now with this 20% day candle because what we’ve just seen isn’t surprising. It sounds crazy and scary when you first play, but in reality it’s pretty common with Bitcoin. “

The trader flipped through Bitcoin’s recent price history to show the number of times it had double-digit pullbacks. In 2021 so far, Bitcoin has seen 6 day closings with a decline of at least double digits.

Davis noted that while sharp declines like the recent one are unlikely to affect the long-term bull market, such declines could be followed by multiple sell-offs in the short term.

Traders view $ 42,500 and $ 40,000 as key levels of support to hold, indicating that further declines are likely.

“Just to give you a perspective that … this is perfectly normal for the crypto market, you should expect it during a bull run. Volatility is the price you pay for performance.

And don’t be surprised if you drop more. Now it’s probably just one big, epic bearish candle and it will all be back in the not too distant future. Usually these huge price drops come before we see any more price drops. “

Bitcoin that loses this level will sink into a sea of ​​bears

Renowned analyst and trader Benjamin Cowen called Bitcoin could be in decline for several months if it can’t hold up above an important level.

BTC is trading at $ 46,747 at press time, according to CoinGecko, a sharp drop from its weekly high of $ 52,774 following Tuesday’s slump.

However, the largest cryptocurrency by market capitalization is still trading above its 20-week simple moving average (SMA), Cowen said.

“On a number of exchanges, BTC has had a bearish wick up to the 20-week moving average … So obviously a lot of people are trying to hold the 20-week MA and are hoping that it will support it at $ 100,000. Remember, moves to the 20 week MA are bull market moves. “

The analyst says that Bitcoin will likely need to hold the 20-week SMA for a sustained rally over the next several months. If BTC closes below this level for two straight weeks, Cowen predicts that the price will likely sink into a three-month bear market before turning bullish again in 2022.

“Even in a bull market that could get us to $ 100,000, the move to the 20 week MA happens a lot, and if we don’t hold it, I think BTC will delay the rally for several months. The 20-week SMA is currently just over $ 42,000. “

Source: Benjamin Cowen

Analyst Justin Bennett also thinks Bitcoin’s downward movement may not be over yet speak that he expects BTC to retest $ 40,000 before rising any further.

“I don’t think the pullback is over. The price closed below the major support on Tuesday and unless we see the market close above these levels again, I think BTC will return to $ 40,000.

This weekly level has yet to be tested as a new support. A lot of Fibonacci confluence supports this idea. “

In addition to Bitcoin, Bennett also has an eye on the decentralized supply chain management platform VeChain (VET).

Pointing out a similarity between the current VET price action and November 2020, he said a retest of $ 0.08 would trigger a rally for the token.

At the time of writing, VET is trading at $ 0.12, according to CoinGecko.

“What if?… Second half. Vocational training follows the November outbreak on T.

If this continues, $ 0.08 could be the higher low we need. Will likely coincide with a retest of $ 40,000 BTC. Should follow up. Even the same Fib level of 61.8%. “

The source: Justin Bennett

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Minh Anh

According to AZCoin News

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