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Bitcoin’s Price Plunge: What’s Next for the Market?

Bitcoin’s Price Plunge Unleashes Volatility: Experts Divided on $25,000 Key Support Amidst SpaceX Shake-Up and Market Speculation.

The cryptocurrency world was hit with a major shock as the price of Bitcoin (BTC) plummeted to its lowest point in over two months, reaching $26,441. This drastic drop was triggered by the surprising news that SpaceX had written down its Bitcoin holdings. The market had been relatively stagnant for some time, with BTC price volatility notably absent. However, all of that changed on August 17, as volatility roared back into the scene, shaking the foundation of the crypto market.

A Volatility Resurgence

Data from Cointelegraph Markets Pro and TradingView confirmed the return of BTC price volatility after an extended period of sideways trading. This month had witnessed one of the least volatile trading environments for Bitcoin, only rivaling moments in September 2016 and the beginning of the year. However, the tranquility was shattered, leaving market observers pondering the potential ramifications.

The Great Bitcoin Price Debate

As the market grapples with this sudden shift, the burning question on everyone’s mind is the direction in which Bitcoin’s price will head next. Experts and analysts are chiming in with their forecasts, trying to make sense of the tumultuous landscape.

Gareth Soloway, a prominent trader and educator, believes that the recent drop below $28,000 has altered the technical landscape. He argues that Bitcoin now has about 24 hours to regain the $28,000 level; otherwise, the likelihood of a descent to $25,000 significantly increases. Soloway emphasizes the psychological significance of the $25,000 mark, recalling how news of BlackRock’s Bitcoin spot price exchange-traded fund (ETF) had triggered a surge from $25,000 to $30,000 and beyond in the past.

The Abyss and the Possibilities

On the flip side, the potential downside scenario is equally compelling. The $20,000 level looms ominously, a point that hasn’t been tested since mid-March. Soloway notes that if $25,000 were to break, $20,000 could become the next key support level. This point holds special significance, as it represents the juncture where funds were shifted from traditional banks to Bitcoin, indicating the cryptocurrency’s perceived value as a safe haven.

A deeper drop to $15,700 or even the range of $12,000 to $13,000 is conceivable if the market continues its descent. Soloway concedes that, in a worst-case scenario, a retreat to $9,000 is possible, although he considers this level as “max pain.”

The Market’s Pulse

Despite these fluctuations, Soloway remains optimistic about Bitcoin’s long-term prospects. He suggests that smart money, which recognizes Bitcoin’s value as digital gold, will continue to accumulate at key support levels, engaging in dollar-cost averaging (DCA) strategies.

Sam MacDonald, head analyst at CCI Australia, introduces an intriguing perspective by characterizing Bitcoin as a “fire alarm for global liquidity.” This implies that Bitcoin’s movements could potentially signal larger upheavals in the broader financial markets, even hinting at a looming stock market crash.

Moving Averages and the Buying Zone

The recent market turmoil has also impacted Bitcoin’s technical indicators. The 200-week simple moving average (SMA), a well-known support level, has come under pressure. Bitcoin’s price action spent a significant period below this trend line in 2022, and as of August 18, it has again fallen below this crucial support.

Caleb Franzen, senior analyst at Cubic Analytics, sees this situation as an opportunity. He considers the cloud around the 200-week SMA as a potential buying zone, indicating his lack of bearish sentiment even in the face of these setbacks. Franzen aligns with Soloway’s view that $25,000 serves as a pivotal boundary for Bitcoin’s price trajectory.

In the midst of these tumultuous times, the cryptocurrency market remains a hotbed of speculation and intrigue. As experts and analysts grapple with the various scenarios, only time will reveal the true direction of Bitcoin’s journey.


  • Benjamin James

    Benjamin James is a senior journalist and reporter at WaxMia. With 7 years of experience at Al-Jazeera, his expertise in global affairs shines through in his insightful news coverage. Committed to journalistic integrity, Benjamin delivers reliable and thought-provoking reporting to readers.

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