After trading within an incredibly tight trading range in between $4,000 and $4,100 for an extended period of time, Bitcoin (BTC) has now broken downwards below its previously established support level at the important psychological level of $4,000.
Now, analysts believe that Bitcoin’s inability to stabilize above $4,000 will lead it drop further in the near-term as dip buyers fail to step in and prop the cryptocurrencies price up.
Bitcoin (BTC) Breaks Below $4,000 and is Likely to Drop Further
At the time of writing, Bitcoin is trading down just over 1% at its current price of $3,970 and is down from its weekly highs of nearly $4,100. Because bulls still do not have enough buying pressure to push the crypto above the low-$4,000 region, it is likely that this price level will persist as resistance for the foreseeable future.
Jani Ziedins of the CrackedMarket blog discussed Bitcoin’s recent drop below $4,000 while speaking to MarketWatch, explaining that he expects the cryptocurrency to see further downside in the near future.
“Bitcoin cannot escape $4k resistance even after poking its head above it the last week. If dip buyers have not come to the rescue yet, it means they are not coming. An investment that refuses to go up will eventually go down. Bitcoin owners need to be prepared for more near-term weakness,” he said.
Ledger Status, a popular cryptocurrency analyst on Twitter, also shared his thoughts recently, explaining that the crypto has multiple strong levels of resistance existing just above its current price.
“Tricky spot for $BTC. Under the bband midline again but above a congestion area. Several support areas below, heavy resistance above. Seems a good way to lose money over if leveraged,” he noted.
Although Bitcoin has found support around $3,900 so far, if its bulls are unable to push its price back above $4,000 in the near-future, significantly further losses could be in store, and a drop back to its 2018 lows in the low-$3,000 region may be inevitable.
Analyst: Bitcoin May Need to Drop to $3,700 Before Surging
Despite its current price action favoring BTC’s bears, the latest drop may be part of a bigger price move that will ultimately send its price into the upper-$4,000 region in the near-future.
Flood, another popular cryptocurrency trader on Twitter, spoke about where he sees BTC heading next, explaining that he expects it to drop towards $3,700 before finding buying support that allows the crypto to surge to the upper-$4,000 region.
This is my trading plan for the next couple of weeks. $BTC pic.twitter.com/tu8jHsKVAR
— Flood [BitMEX] (@ThinkingUSD) March 26, 2019
How Bitcoin responds to its recent drop below $4,000 will give traders and analysts alike more insight into where the entire markets are heading next, as continued downwards pressure on BTC will likely hamper the gains that many smaller cryptocurrencies have experienced as of late.
Featured image from Shutterstock.
