Bitcoin’s Most Important Level Is $19,511 And Here’s Why

Graphic bitcoin prices intervals 1 week

Round numbers tend to attract the attention of investors, and those who follow the Bitcoin chart keep their eyes on the $20,000 mark. But market veterans know there’s a more important and noteworthy figure: $19,511.

This is the maximum that the pioneer cryptocurrency reached during its most recent bull cycle, which ended at the end of 2017. According to Arcane Research analysts Vetle Lunde and Jaran Mellerud, in its roughly 12-year history, bitcoin has never fallen below the peaks of the previous cycle, so a break below this level will be crucial.

“A potential break below this level could lead to the capitulation of many bitcoin holders and to the “collapse” of leverage. Therefore, this is a very important level of support that should be paid attention to in the future, ”the experts write.

Also, aside from the psychological importance of the $19,511 mark, much of the open interest in Bitcoin options is centered on the $20,000 strike, Arcane analysts said. In their opinion, “this could contribute to selling pressure in the spot market if the price of bitcoin falls below $20,000.”

Today, bitcoin is trading at its lowest levels since December 2020, which means that none of those who bought it in the last year and a half and did not manage to sell it, not received profit. Expectations of rapid and massive rate hikes in the US have played a major role in the decline in the price of cryptocurrencies that has taken place in recent months.

Kathy Stockton, founder of Fairlead Strategies, is seeing a “decidedly negative shift in the short-term dynamics” of bitcoin. Break below $27,200, she said increased the risk of falling further to around $18,300 – $19,500, which is another area of ​​support.

“Bitcoin and most other risky assets remain out of favor in such an environment (monetary tightening – approx.,” the expert notes.

Meanwhile, the cryptocurrency sell-off has already prompted a number of companies to announce staff cuts and hiring freezes. Coinbase Global announced this week that it will lay off 18% of its workforce, following in the footsteps of other crypto companies including Gemini Trust and lender BlockFi Inc. who have taken similar steps.

Peter Chir, head of macro strategy at Academy Securities, says such developments, along with potential cuts in crypto companies’ spending on advertising, conferences and other things, could begin to affect the wealth of digital asset holders.

“If the slowdown is real – and I think it is – I think we might hit the $10,000 mark in bitcoin. And then we can see a domino effect in the economy, which we did not think about two or three years ago, ”the expert said on Bloomberg TV.

Prepared by by materials Bloomberg agency

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