Bitcoin drops to $38,000: nothing more volatile than crypto!
Just when all the crypto enthusiasts thought the worst for Bitcoin was almost over, they were faced with another jolt, which proves that nothing is more volatile than crypto.
The sustainability of cryptocurrencies has been advocated in the aftermath of Russia’s attack on Ukraine, the viability of cryptocurrencies as a safe haven is already being tested. Bad week for Bitcoin, since the very first day of March the price of Bitcoin – the most popular cryptocurrency leading the growth of the crypto market in the world – began to decline at a slow but steady pace . However, on March 3, it began to crash precipitously, and from that day until this morning, BTC lost 14.65% of its market value, dropping from $44,031 to $37,578.
The estimated market Bitcoin’s capitalization is now at $724.01 billion, which has resulted in the loss of nearly $540 billion in just three months now.
Bitcoin fell in an extended cryptocurrency selloff, surging above $38,000. It is trading almost 45% below its all-time high (ATH) of $69,000 on November 10, 2021.
Does that mean the dive is lucrative enough to buy?
The answer is quite tricky; If bitcoin fails to clear the $37,500 barrier, it may continue to decline.
- Hourly MACD – The MACD is currently accelerating in the negative zone.
- Hourly RSI (Relative Strength Index) – The RSI for Bitcoin/USD is currently near 30.
- The main support levels start at $37,000 and go all the way up to $35,000. $38,500, $39,800 and $40,000 are the main resistance levels.
- The fear and greed index went from 22/100 to 23/100 this morning. Despite the increase, the index remained in the “Extreme Fear” category. Last week, the index had visited the 50/100 levels and the “Neutral” zone before the reversal. For Bitcoin bulls, the index will need to retrace to 54/100 to bring back the $50,000 levels in play for Bitcoin. A drop below 20/100 would give levels below $30,000.
Bitcoin is considered by cryptocurrency enthusiasts to be “digital gold,” a convenient place to deposit funds in times of conflict or calamity. As the ruble is hit by Western sanctions aimed at squeezing the Russian economy and cutting it off from the global financial system, cryptocurrency trading in Russia has exploded.
According to researcher CryptoCompare, trading volumes between the ruble and major cryptocurrencies reached 15.3 billion rubles ($140.7 million) on Monday, a threefold increase from the previous week.
Ruble-denominated transactions using Tether, a so-called stablecoin meant to maintain constant value, hit 3.3 billion rubles on Monday, the biggest this year and nearly five times more than a week earlier, according to statistics. According to the data, individuals in Russia are rushing to convert their assets into cryptocurrency.
All of the latest predictions, along with Bitcoin’s collapse, have sparked the interest of individuals who believe they have passed up a fantastic opportunity to invest in Bitcoin earlier. However, cryptocurrency volatility will still be present in the markets amid the war between Russia and Ukraine.
In contrast, there is immediate support at $35,000. The next significant support is indicated near $35,000. If the price breaks below the $35,000 support level, it may start a major meltdown. In the aforementioned scenario, there is a possibility of a move towards the $30,000 level.
Although it is difficult to determine a fair value for Bitcoin, it seems that Bitcoin is trading around an “acceptable” value. JPMorgan, one of the big four, did a lot of research and data to identify a fair value for Bitcoin a few days ago. However, the article also stated that it could reach $150,000 in the coming years.
Since cryptocurrency hasn’t been around long enough to be properly tested in times of crisis, it’s essential to remember that even gold doesn’t always rise during a financial crisis. Also, keep in mind that a hedge doesn’t need to rise, it just needs to hold its value.
“Every crisis has its dangers and its opportunities. Everyone can spell salvation or doom. – Martin Luther King”
Investors, who have already bet their money on Bitcoin, are now watching the drop with no hope of grabbing anytime soon. On the other hand, experts are betting if it hits a new year low, falling below $29,807.
It would be interesting to see how the market behaves in the coming weeks, but in the current scenario, experts advise to stay away. Given the current circumstances, what is your view on crypto volatility? Do you consider bitcoin a safe haven at this level?