Bitcoin

Bitcoin Dips Down to an 8-day Low as the Selling Pressure Increased

Published

3 years ago

February 23, 2021

Bitcoin crashed down to an 8-day low as selling pressure increased. The single most consequential problem with Bitcoin is its high volatility, rather extremely high volatility, and it has been exhibiting it for as long as it is been around.

Non-technical Historical analysis of BTC’s volatility:

Look when for the first time BTC surpassed $20,000, in mid-Dec, t did not stay their rather, it continued exploding until it surpassed $40,000 during early Jan. It illustrates that the coin had grown by more than 200% in between mid-dec and early Jan. But as soon as it surpassed $40,000, displaying its high volatility, it dipped down to the price level of $31,000 in 20 days or so; losing almost 255 of its value.

Then, right after, it exploded again and this time it went from $31,000 to $58,330; Bitcoin’s all time that it achieved just two days before and later, displaying its extreme volatility again it sunk down to $45,000 (8-day low) within hours after recording its all time high. Currently, at the time of press, it is down by over 15%- trading at $46,435.

Now, arguably, the resistance level for BTC is $48,000 as the $46,000 price level continues to provide short-time support to it.

Three months price chart will help you comprehend it more clearly:

What caused the BTC crash?

The most obvious and apparent reason is the selling pressure caused by the BTC’s skyrocketing value. What happens is as the BTC’s value increases vehemently, for a relatively long period the investors, at some point in time, start selling it; which directly causes the BTC’s value to decline.

Moreover, though the recent on-going decline in BTC’s value is perceived significant as it is regarded as a crash by many, it still is not alarming as Cointelegraph’s market analyst and investor Michaël van de Poppe stated in a tweet: “We’ve experienced 2018 & 2019. This is nothing,”