Just when we thought Bitcoin was seeing some type of stability the price plunged more than 10 percent in less than an hour reminding investors that volatility in the crypto currency is here to stay.
Before taking a plunge, bitcoin had racked up gains in 8 out of the previous 9 trading sessions and looked to be entering some type of rally.
That theory was quickly put to sleep, but some analysts see the selloff as nothing new and maybe a good opportunity to take a long position in the crypto currency, as long as the price remains above certain levels.
“The reality is there is nothing abnormal about huge moves in the crypto market over the weekend, mainly because of thinner volume and bigger order sizes,” wrote Naeem Aslam, chief markets analyst at Think Markets U.K.
“The bottom line for me is that the current selloff would [likely be] an opportunity only if the previous lows are not violated…[but] if we break the previous lows, it will very much confirm that the recent jump in the crypto market was a bull trap.” He added.
Before bitcoin took its more than 10 percent plunge, the price was knocking on the door of $4200 which some say is a key resistance level which will have to be broken if any sustainable rally is to eventuate.
“We can see clearly now that the $4,200 BTC level has formed RESISTANCE, and until that level gets broken to the upside, we will remain BEARISH of the crypto space.” Said BitOoda Executive VP of Institutional Sales Brian Donovan
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