After falling below $9,000, why can’t the price of Bitcoin fall any further?

Source: CointelegraphChina

Why does the price of Bitcoin always fail to fall? There are probably three reasons.

Yesterday during the day, Bitcoin was in a state of decline. At around 2 pm, the price on Coinbase fell to a low of US$8,895. The buying here was quite strong, and it quickly recovered the loss of US$9,000. In the evening, with the help of the rebound of US stocks, it set a new intraday high, reaching US$9,500 at one point.

The price trend of Bitcoin this time is very strange, and so is the price performance of gold. It seems to be following the trend of US stocks. This also reflects the global capital sentiment. In the face of the epidemic and market uncertainty, risky assets and safe-haven assets will be driven by market panic.

From a technical perspective, Bitcoin quickly recovered after a short downward spike, and the price returned to the convergent triangle range again. The strong buying below directly broke the short-term downward trend.

Image source: tradingview

So why does the price of Bitcoin never fall where it should?

There are three reasons. First, with the entry of large funds such as Grayscale and Fidelity, their position building costs are also around 8,000-9,000, which will not give retail investors too many opportunities to copy their bottoms. Second, new funds are still entering the market and existing funds continue to buy. Now, Grayscale alone buys nearly 1,500 bitcoins on average every day. You must know that the current average daily output of Bitcoin is around 900, which not only completely covers the selling pressure of miners, but also plays a certain role in protecting the market. Third, when the bearish views of market analysts and retail investors are unprecedentedly consistent, that is also the time for the main force to borrow contracts to reap against the trend, and naturally the price cannot fall further.

Operation suggestions:

If the BTC price can stabilize at $9,500 today, it will continue to be bullish; if it falls below $9,000 again, the price will look for support around $8,700; the current market trend is strong and the overall market trend is bullish.

Large funds are bullish but do not go long and need to wait for opportunities. Small funds or contracts above $9,150 can go long on dips, with a stop loss at $8,970 and a take profit at $9,620 or $9,750.

Original link: https://cointelegraph.cn.com/news/bitcoin-fell-below-9-000