Bitcoin Price Takes a Massive Hit, Pushes Market Cap Below $1 Trillion
After enjoying a good run in the second week of March, Bitcoin price has taken a massive hit this week as the price continues to bleed.
Yesterday, there seemed to be some relief after the price touched $57,230. The price soon melted. At 12:58 GMT on Thursday, the price was trading at $51,528, a loss of almost 10% in the last 24 hours.
As the digital asset corrects, investors have not taking this lightly. Many have resorted to taking profit. Cumulatively, BTC investors have pulled out close to $145 billion. This exit has caused the market capitalization of the king cryptocurrency to fall below $1 trillion.
Recall that Bitcoin first cleared the $1 trillion market cap level earlier this year. It went on to surpass this level in the third week of February 2021. Soon after, the coin dropped in Market value less than a week later. The benchmark cryptocurrency retested a $1 trillion market cap figure in the second week of March. Until now, the coin has remained on this level.
According to CoinGecko, the BTC market capitalization is currently $980 billion, having dropped $140 billion over the past seven days since last Thursday, March 18.
Just a few days ago, analyst Willy Woo predicted this fall in market cap. He mentioned on Twitter:
$1T is already strongly supported by investors. I’d say there’s a fair chance we’ll never see Bitcoin below $1T again.
It’s suggested that the reason behind this correction is retailers and institutional investors taking profit after Bitcoin hit its new record high. As per analyst Josh Rager:
Unrealized profits aren’t realized until they’re in the bank.
He continued to note that firms and investors will all end up taking profit, even if they have suggested otherwise in the past. Pointing towards MicroStrategy’s CEO Michael Saylor, he added that they will sell high and buy low. A strategy popular among traders used to maximise profits. He added:
Don’t try to act like Saylor won’t take profits eventually, cause he will along with every other fund on the planet. Then they’ll buy back lower.
Analysts see $46,000 as an imminent price
Bitcoin bulls are expected to prepare for shock as technical indicators show that Bitcoin will slump to $46,000 soon.
Market analyst Jonny Moe, the BTC/USD exchange rate risks declining to the said level as it declines below the price floors of two classic technical patterns: Double Top and Descending Triangle.
We broke down out of the double top, but we've caught at least some initial support at the $52k horizontal level.
Gonna take my own advice from my first tweet in this thread and step back to see how we react.
— Jonny Moe (@JonnyMoeTrades) March 25, 2021
The point of trendlines convergence sits inside the $50,000–51,000 area. Bitcoin expects to fall inside it before it attempts a bullish breakout. Any fall below this $50k area, will take the coin straight to $46,000.
Additionally, analyst Vince Prince explained that pioneer cryptocurrency could be heading toward the point at which the Wedge’s upper and lower trendlines converge.
Prince added that this does not mean that Bitcoin is completely bearish. He said:
Now, this does not mean Bitcoin is completelywill be important on how the cryptocurrency approaches the lower supports and how it manages a potential bounce from there. When this bounce can sustain strong enough, it can lead to further stabilization and also a potential reversal.
The BTC/USD chart still shows a bullish outlook is consistent with the coin price witnessing higher lows and higher highs. Meaning in a few days, as March closes, we will be able to say where the price is headed.
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