Bitcoin traders are becoming increasingly concerned about the possibility of a deeper price drop, with some warning that the $20,000 mark may not survive if the cryptocurrency loses its current support. As of March 9th, Bitcoin rested at multi-week support at the Wall Street open, circling around $21,800 on Bitstamp. However, with $22,000 in danger of flipping from support to resistance, popular trader Pentoshi warned that further undoing of support may come next. He wrote in an update on a prior BTC price forecast, “We made it. Best r/r currently however not a fan of the slow bleed. Would have liked a SFP (one may still come). Below this can get ugly w 19.7-20.5k on the table.” An accompanying chart showed the significance of the current spot price zone within Bitcoin’s broader range, and the potential consequences of the range were lost.
Trader and commentator Nunya Bizniz flagged a similarly bearish signal currently playing out in the form of Bitcoin’s 200-day exponential moving average (EMA). Based on historical patterns, he warned, room for losses clearly remained. The 200-day EMA also featured in the roadmap of fellow popular trader and commentator Pierre, who inferred that there would be little stopping BTC/USD from dropping to its 100-day MA should a breakdown now ensue.
Data from the Binance order book showed the “busy” area of bid and ask liquidity surrounding spot price. With fresh US jobs data due, monitoring resource Material Indicators was bracing for volatility, this as yet remaining absent. In a glimmer of hope on the day, macro markets began climbing on the Wall Street open, with the US dollar losing ground gained earlier in the week. The US Dollar Index (DXY) was down 0.4% at the time of writing, while the S&P 500 and Nasdaq Composite Index both aimed for 0.5% increases.
Overall, Bitcoin traders are keeping a close eye on the cryptocurrency’s price action as concerns about a potential price drop grow. The current support level of $22,000 is crucial, with some traders warning that a loss of support could lead to a significant drop in price. The 200-day EMA is also playing a key role in the current market, with historical patterns suggesting that there is still room for losses to occur. As fresh US jobs data is released, there is likely to be an increase in volatility in the market, although this has yet to materialize. Despite these concerns, there is some optimism among traders, with macro markets beginning to climb and the US dollar losing ground gained earlier in the week. However, it remains to be seen how this will impact Bitcoin’s price action in the coming days and weeks.
