Bitcoin prices fell just below USD 7,000 on Monday morning after a late Friday rally brought the asset above key levels for the weekend.
However, concerns about the corona virus have returned to traditional markets, which has created great turmoil during the day, which may also have caused Bitcoin to fall. Could there be a repeat of the chaos of the past month and a retest of extreme lows?
Bitcoin price is below $ 7,000 after the weekend retest of highs
Bitcoin price has had trouble pushing overhead resistance above the mid-$ 7,000 range throughout April.
After the record-breaking collapse in mid-March – now called Black Thursday – the first cryptocurrency had recovered from the extreme lows of USD 3,800 and almost doubled in less than a month.
The bulls who feverishly bought Bitcoin at such low prices seem to have run out of steam. Or it could be that fear, uncertainty and doubt get the best out of them.
With news that the economy will continue to be stuck and that coronavirus cases are unlikely to flatten the curve, investors panic again and begin to lose their assets in anger.
Oil prices dropped to 20-year lows and Dow futures fell overnight. The last time Bitcoin price collapsed, it was closely correlated with the stock market.
The stock market, which is preparing for a further downward trend, is not a sign of the cryptocurrency market. The high-risk asset class filled with speculation and hype could see another sharp decline, much like the madness in March last year.
Traditional market chaos and volatility spikes could be dangerous for Bitcoin
Bulls must hold $ 6,800, or a push into the lower range of $ 6,000. If you don’t hold this level, the Bitcoin price could retest last month’s low or possibly fall to hit the asset’s bear market low.
At this point, and with an event involving black swans like the corona virus, which continues to be a dark cloud over the economy and markets, this type of turmoil is likely to continue and anything is possible.
Given that Bitcoin and the crypto space are relatively illiquid compared to other assets and there are no proven use cases and no widespread use, the assets could theoretically go to zero.
However, given the halving of Bitcoin, which is expected to have a significant positive impact on supply and demand, the current decline could be an opportunity not to be missed.
Earlier halving has brought the Bitcoin price to a new all-time high, but this is the first halving to take place under such bearish conditions.
With so much going on, Bitcoin’s fate is really at stake.
Featured image from Pixabay