Today, the Crypto space woke up to a bloodbath Cryptocurrencies as the firstborn cryptocurrency, Bitcoin is still continuing to lead other altcoins towards a sell-off zone due to a liquidity break following the United States equity market closing on Good Friday.
At the time of reporting, the flagship currency is changing hands at $39,334 with a fall of 2.67% over the last 24hrs.
Bitcoin Below Support Level
The king currency that is leading the cryptocurrency space by market cap dropped to $38,577 in the early hours today and this level was last seen on March 15.
IntoTheBlock, an analytics firm’s analyst, claims that the $40,000 range was very much important as it was a crucial support zone, and in the past, this level has been poised for significant buying activity. This latest decline accounts for a loss of over 17% since the Bitcoin tested above $48,000 a few weeks ago.
This fragile performance by Bitcoin is the result of tax-related selling and the gloomy macro environment. Jeff Andreson, CIO at the quantitative trading firm and liquidity provider Folkvang and Trading, claimed through Telegram that
“Tax-related selling has definitely played a role in recent weeks. However, it is difficult to say exactly how much of the weakness has been due to the impending tax deadline.”
On the other hand, as per George Liu, head of derivatives at Babel Finance, for Bitcoin to drop below $40,000, the correlation with stocks could be the dominant reason.
Also, a similar piece of opinion was put forth by Amber Group, a Crypto service provider asserting that “a lot has to do with the poor macro conditions… look at equities and Nasdaq [tech-heavy index] and the rise in the real yields.”
Where Is The Selling Pressure Popping Up From?
According to the Blockchain data, selling pressure is most likely emerging from short-term traders who have some important acquisitions. Also the most important, spent output value band, which depicts the distribution of all spent outputs as per their values, indicates that most of the coins which have moved into the exchanges in the early hours today were from 10-100 Bitcoin and 100 Bitcoin and 1000 Bitcoin cohorts.
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