The crypto market has been crashing since November 2021. Most cryptocurrencies lost on average more than 50% in valuation. Bitcoin’s dominance on the crypto market is still apparent, with a current dominance of over 46%. Bitcoin prices fell recently below the psychological price of $30,000. Many investors are waiting for another bull run like the ones that occurred back in 2020 and 2021. However, Bitcoin is still in consolidation mode. If prices fall below a certain price area, Bitcoin can still crash lower. In this article, we’re going to analyze Bitcoin prices and assess when to sell Bitcoin!
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Why did the Bitcoin price fall?
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There were several influencing factors why the Bitcoin price fell so sharply:
- Due to the strong inflation, the American Federal Reserve Board had been planning to raise the key interest rate for several months. Ultimately, the key interest rate rose by 0.5%. That was the strongest increase in over 20 years. Both the announcements and the ultimately strong increase resulted in the Bitcoin price falling.
- The weak economy due to the pandemic and the war in Ukraine caused share prices to fall. Unfortunately, bitcoin has become more and more dependent on tech stocks over time. This development harmed bitcoin.
- Many speculative investors, especially in the foreign exchange market, sold their positions when there was a slight drop so that the crashes were amplified. This led to a massive negative spiral for Bitcoin and the bear market.
Is the current Bitcoin price good for Buying?
Bitcoin prices have fallen from a peak of $69,600 to a current level of $29,350. The whole cryptocurrency market fell as a result of the 57 percent decline in pricing. As a reaction to the plummeting prices, a snowball effect began to occur, in which additional crypto projects were affected and, as a result, plunged even more.
The price range of $30,000 for Bitcoin is critical. In reality, several large corporations bought Bitcoins at that price. In addition, as seen in Figure 2, Bitcoin values previously consolidated around those same regions before beginning an advance.
When to Sell Bitcoin?
If you talk with a crypto or Bitcoin fanatic, he will most probably tell you never. However, selling something to buy it at a cheaper price is what good investment is about. When traders short sell in falling markets, this is exactly what they do. Since Bitcoin and the crypto market are considered in a bear market, we can safely set specific sell and buy areas.
Currently, for Bitcoin, that sell area is around $28,000. Bitcoin did reach a low price of $25,500 back on the 12th of May 2022, but that was for a very brief moment due to panic selling across the crypto market. That’s why this move is considered a classic “Fakeout”. However, if prices fall below $28,000 today again, it is safe to assume that Bitcoin will continue to crash, specifically to $22,200.
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