The Bitcoin course could no longer continue its upward trend in recent days and fell again more strongly.
The Bitcoin rate has seen a stronger decline for a long time. After the BTC price broke above the important $30,000 mark for the last time, the price has dipped back below the $29,000 mark in recent days.
With a 6% loss in the last 7 days, Bitcoin has suffered a major setback for the first time since the start of the US banking crisis in early March. However, the price of Bitcoin is up more than 90% since the beginning of the year.
Reasons for the Sharp Drop in Bitcoin Price
The crypto market is characterized by its high volatility, with rises and falls in a matter of hours or minutes.
The Bitcoin price crash had no clear isolated trigger. It appears to be a slight correction after steady growth since March. However, there are some factors that could affect the Bitcoin price drop, explained below.
First, the vote on the EU MiCa regulation. which took place yesterday, Thursday, in the EU Parliament, where the regulation was decided. With MiCa, there will be numerous bureaucratic hurdles for cryptocurrency providers from 2024.
Second, the plans of the US Federal Reserve to determine the direction of the key interest rate for the US dollar at the next meeting. Fed Chairman Jerome Powell recently said he thinks further interest rate hikes are appropriate. Most observers expect a 0.25 percentage point rise, making the crypto market slightly bearish.
The US government has seized a large amount of Bitcoins from illegal activities and plans to sell them in four different batches before the end of this year. The first sale is scheduled for May 26, which could put selling pressure on BTC. However, investors could use this opportunity to buy Bitcoins at a lower price and benefit from the price increase in the future.
Will There Be a Move Towards $36,000 Soon?
The setback for Bitcoin’s course is no reason to panic just yet. In the medium term, the price of Bitcoin remains in a bullish channel. The $28,000 level has been established as extremely strong support, and the next break could see a rally toward the $36,000 target.
If the Fed’s interest rate policy sees a trend reversal in the coming months, which seems likely if the key interest rate for the US dollar were to rise via dollar inflation, Bitcoin’s price would benefit greatly. In the Bitcoin summer forecast, even $50,000 is possible.
Technical BTC Analysis
According to the analysis published by Ripio Select! the price of Bitcoin continues with strong sellers and is heading to reach support in the price ranges of US$28,100 and US$27,820.
If Bitcoin manages to overcome the mentioned support, the next medium-term objective could be the price range of US$27,000, since this is strong support and cannot be broken; otherwise, there will be a liquidity vacuum that could lead to further falls. Resistance points are between $30,030 and $30,400.
Based on the Live Coin Watch portal, Bitcoin (BTC) is trading today, April 21, at US$28,251.39, positioning 98% compared to its value 24 hours ago, and 92% compared to the same day last week.
By Audy Castaneda
