Bitcoin Price’s Sharp Drop Not A Matter Of Concern As Long As We Don’t Break The Key Area
- Bitcoin needs to stay above $9,400 to not turn bearish
- Analyst says, BTC to go back above 10k before going for another drop
- US Fed and ECB introduce stimulus for market
- Bitcoin tends to perform well during lower equity market volatility
Bitcoin price took a big blow on Sept. 19 when under five minutes, it lost $400 and dropped to $9,600 level.
This level was last seen in early September, meaning all the progress made by BTC this month, has been all for nothing.
Since hitting $9,600, we have started making our way upwards, currently trading at $9,886 with 24 hours loss of 2.96 percent as per Coincodex.
Trading volume, though still low at $853 million, has gained momentum since starting the week at $350 million.
Despite Bitcoin taking a deep dive to $9,600, it is not a matter of concern at least until it continues to close above $9,400.
Not really worried unless price breaks and closes below $9400 again
This is the area to keep an eye on pic.twitter.com/dLRAht4DD4
— Josh Rager 📈 (@Josh_Rager) September 19, 2019
Analyst The Cryptomist, however, sees “bulls pushing this back up to 10050 range, where we could load up for another drop.”
While Bitcoin failed to break out of its “extensive consolidation pattern for any sustainable period,” before taking a nosedive, altcoins like Ethereum started running up.
Altcoins like XRP, today Stellar with 38% gains are going crazy. As a result, BTC dominance has dropped below 70%.
While this week is turning out to be good for altcoins, it has been through and through bad for Bitcoin as CME also hit its lowest volume in 4 months, reported Skew Markets.
Bitcoin Tends to Perform well During lower equity Market Volatility
All of this happened while the US Federal Reserve printed money like crazy this week while ECB kicked it off with the announcement of a 10 bps rate cut and a new asset purchase program last week.
Fed is further expected to follow suit with its own 25 basis point rate cut and asset prices bid up on the back of central bank stimulus.
What does it mean for BTC?
According to Delphi Digital an independent research boutique,
“Bitcoin tends to perform well during periods characterized by lower equity market volatility. For example, the parabolic BTC run up in 2017 coincided with one of the least volatile years on record for U.S. stocks.”
Bitcoin bull and Fundstrat’s Tom Lee, however, believes BTC will surge when S&P will move to its new highs.
Recently, BitMEX’s Arthur Hayes predicted BTC’s run to $20,000 on the wake of the Fed injecting billions into the market.