Buy Bitcoin: BTC crash below $ 33K. was it Immediate opportunity to seize

By: Bharggavi Ssayee

June 10, 2021 5:28 AM

While trading near $ 38,000 yesterday afternoon, Bitcoin fell sharply last night and overnight, hitting a low at $ 32,450 around 4am. This represents an impressive drop of around 15% in about 12 hours, which is cause for concern. However, this fall does not fundamentally change the profile of Bitcoin yet, and could therefore constitute an opportunity to buy Bitcoin.

Let's start by explaining the reasons for the recent drop, before determining if now is the right time to buy BTC.

The key factors weighing on Bitcoin

Although it did not fall sharply during the first part of the day yesterday, Bitcoin received several bleak news, the cumulative of which may well explain the weakness of the cryptocurrency.

First, it should be noted that last weekend, a major Chinese social network blocked several pages related to cryptocurrencies. Given recent Chinese comments confirming the country's crypto trading ban, this has raised fears of stronger government actions against cryptocurrencies.

Another detail that is a negative factor for Bitcoin concerns a report by Goldman Sachs, according to which Asian hedge funds are increasingly abandoning Bitcoin, which tends to confirm that after being interested in cryptocurrencies, institutional investors quickly got bored.

Although it cannot be said that this played a key role in the fall of Bitcoin last night, it is also relevant to point out that former US President Donald Trump made very strong remarks on what to say. concerns Bitcoin and cryptocurrencies in general.

"Bitcoin just looks like a scam," said Donald Trump, adding, "I don't like it because it's another currency that competes with the dollar."

Bitcoin could drop again this weekend, because of Biden

Bitcoin forecasts where we will be at the end of the year Finally, the latest information that could explain the strong downward pressure on Bitcoin on Tuesday concerns the prospect of seeing current US President Biden speak out on cryptocurrencies this weekend at the occasion of a G7 summit.

Jake Sullivan, Biden's National Security Advisor, in fact told a White House briefing that President Biden will discuss the role of cryptocurrencies in the recent headline-grabbing ransomware cyberattacks. It will be recalled in particular that the most important pipeline in the eastern United States was blocked for several days by one of these attacks, which demanded a ransom in Bitcoin.

Thus, there is little chance that the remarks of the US president this weekend could encourage a rise in Bitcoin. However, he is also unlikely to announce anything concrete, with most analysts agreeing that achieving effective cryptocurrency regulation will still take a long time.

Therefore, buying Bitcoin in the face of a further drop next weekend might also be a good idea.

Does Technical Analysis Suggest Now Is The Right Time To Buy Bitcoin?

From a graphical point of view, it should be noted that last night's drop, while worrying, could be a great opportunity to buy Bitcoin at a low price. The main technical argument for this strategy is that Bitcoin has yet to test the threshold of $ 31,500-32,000 where the May 19 and 23 lows lie.

A break below this zone would therefore constitute a bearish signal, which would allow anticipating a rapid fall to $ 30,000, a threshold which could also play a role of support.

So, as long as the $ 30,000 threshold is not broken, the current drop can be seen as an opportunity to buy Bitcoin.

If BTC starts to rise again, the intermediate psychological threshold of $ 35,000 will be the first potential resistance, ahead of the 200-hour moving average which clearly blocked Bitcoin yesterday, and which is currently around $ 36,600. Higher, the psychological threshold of $ 40,000 will also be considered as a potential obstacle, before the 200-day moving average at $ 41,900.