Bitcoin (BTC) continued to drop lower on Feb. 21 as the $38,000 level became the latest level to fail the test for bulls.
$40,000 Seen As BTC Relief Bounce Target
Data from Cointelegraph Markets Pro and TradingView painted a gloomy picture for the BTC/USD pair on Monday, as support at $38,000 abruptly disappeared after holding throughout the weekend.
#BTC Update 1h TF
First retest of key trendline since reclaim @ $38.5k
Current range $36.6k – $37.8k pic.twitter.com/sjxUv7AGlV
— AN₿ESSA (@Anbessa100) February 21, 2022
#BTC Update 1h TF
First retest of key trend line since rally @ $38,500
Current range $36,600 – $37,800
While it threatened to invalidate analysts’ hopes of a bottom, the chances of a bounce to $40,000 were good, one argued.
“I don’t expect this leg to go very deep, should see a bounce back towards 40,000 soon,” said Crypto Ed to Twitter followers.
In a video update on day, Crypto Ed had forecast a multi-legged downtrend to continue, with $40,000 forming the target for a relief bounce before another dip, which even has the potential to take out $30,000.
“If we somehow manage to get back above $40,000 and higher then I’m bullish, otherwise not,” he concluded, adding that it would take a “miracle” for such a bullish case to come true.
On the negative side, A silver lining appeared in the form of increasing offers of $37,000 appearing on the Binance order book as the BTC/USD pair fell.
The data from monitoring resource Material Indicators further highlighted large transactions that remained fairly constant, indicating that institutional-grade investors remain interested in BTC exposure.
Smaller buyers, however, were hesitant at current levels.
“Some bid liquidity in the $20,000 range has trended up to $30,000 but I want to see more concentration of bids to get the market buyers out of hand”added Material Scientist, creator of Material Indicators, in comments on a chart showing the latest action.
Entering a familiar Chinese tech crash
meanwhile uA holiday on Wall Street meant a lack of compelling volume in the crypto markets on Monday, which could exacerbate moves in either direction due to tight liquidity.
However, the macro signals continued to come through, with developments in the Russia-Ukraine conflict poised to disrupt already lopsided sentiment.
The death reports at the border came as European stock markets roiled, with the FTSE 100 down 0.5% in London and Germany’s DAX down 1.3% on the day.
Another tech crackdown in China fueled separate problems for Asian markets, with Tencent shedding more than 6% during trading on the day.
tencent leads #China tech selloff amid fears of further crackdown. Tencent fell as much as 6.3%. Beijing’s banking watchdog issued warning against illegal fund-raising schemes & an industry association vowed Mon to resist speculative trades in cap mkt. Alibaba dropped 4%. (BBG) pic.twitter.com/OZBDK2Hbyv
— Holger Zschaepitz (@Schuldensuehner) February 21, 2022
Tencent leads #China tech selloff amid fears of further crackdown. Tencent fell as much as 6.3%. Beijing’s banking watchdog has issued a warning against illegal fundraising schemes and an industry association has promised Mon to resist speculative trading on the market capitalization. Alibaba fell 4%. (BBG)
The drop in tech stocks was very reminiscent of July 2021, the period during which Bitcoin retraced all of its year-to-date gains to around $29,000.
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