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Bitcoin price analysis March 10: The risk of falling to $ 7,500 when the global market faces disaster

A bailout rally could prevent Bitcoin from falling to $ 7,500 when the global market faces disaster

A “bloody” Monday for the stock and oil markets, when European stock markets are losing 8% and oil registered a 30% drop. But not only in the stock market, the crypto market is suffering the same painful losses, with Bitcoin (BTC) losing $ 1,500 in two days.

Can Bitcoin rise in times of economic instability? The opposite seems to be happening, while gold has shown strength in recent weeks.

Daily crypto market performance. Source: Coin360
Daily crypto market performance. Source: Coin360

Bitcoin failed before resisting $ 9,150 and returning to $ 7,500

Bitcoin's price dropped significantly two weeks ago – a time when the market experienced a similar $ 1,500 decline that week. However, some rebounds were seen last week, but then another incident appeared after BTC failed to surpass $ 9,150 by the end of the week.

1-day chart of BTC / USDT. Source: TradingView
1-day chart of BTC / USDT. Source: TradingView

Bitcoin's price had to exceed $ 9,150- $ 9,300 to maintain its momentum. However, this test failed, and the resistance was confirmed.

In the end, a test of $ 8,200 will guarantee any victory, but even this level cannot bring any support to BTC. Losing the next support, then BTC went to $ 7,600 and turned up here.

As seen in the chart above, the $ 8,200 and $ 8,500 levels are the overhead resistances, while the $ 7,300- $ 7,500 area is an important support area below the current price.

The drop in the weekend left a huge CME gap

2-hour CME chart of BTC / USD. Source: TradingView
2-hour CME chart of BTC / USD. Source: TradingView

Bitcoin's 2-hour CME chart is showing a big gap – which was created during the weekend's volatility. However, another important aspect is shown in this chart. There is still a gap in the chart since the beginning of 2020, at $ 7,600. Due to the large sell-off at the end of the week, the gap was filled, which may refer to a potential bottom scenario.

Finally, about 95% of the space is filled. As the market fills this gap, there are still a few gaps to open, with the main gap created over the weekend, from $ 7,900 to $ 9,100. And there is still another gap ready to be filled around $ 11,600.

Gold outperforms Bitcoin in 2020

Bitcoin does not currently respond to its “digital gold” moniker. On the other hand, gold itself is maintaining strength during the current economic crisis. Gold prices have increased by 11.5% in 2020, while Bitcoin prices have increased by 8.5% this year.

Macro profit in the current year. Source:
Macro profit in the current year. Source:

Both gold and Bitcoin still outperform the stock market. The indices of the Netherlands and Germany decreased by 20%.

So far, Bitcoin still shows a significant correlation with movements in the stock market. Does that mean Bitcoin is not a complete shelter? No, no conclusions can be drawn from that.

During the 2008 credit crisis, gold also recorded a similar decline when it lost 30% in a year, next to the stock market. However, after that, gold outperformed the stock market quickly until its peak in 2011.

Thereby, investors and traders in the stock market often sell their risky assets to compensate for their loss of equity. Bitcoin was the first thing to be sold in that scenario.

However, as the case of gold is showing, Bitcoin could greatly benefit in the coming years, if much trouble occurs. But what can the market expect in the short term?

Total market capitalization is ready for major support

Weekly chart of total crypto market capitalization. Source: TradingView
Weekly chart of total crypto market capitalization. Source: TradingView

The chart of total market capitalization of cryptocurrencies is showing a significant sell-off and a failure of the $ 300 billion resistance level. Through it, the first key support levels are found in the green zone, from $ 185 billion to $ 205 billion.

It is likely to expect a continuation towards that support area to test, based on higher time frames. It could see a short-term rebound occurring in the market. However, support is being tested, and this is the first major area below the current market cap.

Bitcoin targets $ 7,300-7,500 to test support

1-week chart of BTC / USD. Source: TradingView
1-week chart of BTC / USD. Source: TradingView

Bitcoin's larger time frame shows the structure clearly going down. Thereby, a test of support of $ 7,300- $ 7,500 appears to be necessary before any support can be built. The first strong resistance zone is currently at $ 8,200. A failure to this resistance can push Bitcoin down and test support at $ 7,300- $ 7,500.

However, if the sell-off continues with the markets, it will not be surprising to see the decline continue to drag BTC down to $ 6,700 to $ 6,800.

Short-term relief expectations turned up at $ 8,200

1-day chart of BTC / USDT. Source: TradingView
1-day chart of BTC / USDT. Source: TradingView

Should traders expect $ 7,300- $ 7,500 levels to be attacked in one go? No, because the price has witnessed such a massive sell-off, a relief price increase is reasonable. Bitcoin's price is currently at the support of $ 7,800, which can help hope a relief rally.

The expected resistance above is $ 8,200 and $ 8,500. These are the levels that have been tested and confirmed as resistance. If this level fails, then the ability to continue towards $ 7,300-7,500 is expected in the market.

Is there any confirmation that could see such a recovery? Is not. I mainly focused on the $ 7,300-7,500 range and also waited to see if the stock market would experience a bout of relief. If the stock market bounces, then similar moves can be expected for Bitcoin.

Readers can update BTC rates and more than 2,000+ cryptocurrencies in real time here.

Disclaimer: This article is an analysis by cryptocurrency analyst Michaël van de Poppe – a regular contributor to CoinTelegraph. Readers should only consult, do not consider this as an investment advice, especially from Toiyeubitcoin, we will not be responsible for your investment.

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According to CoinTelegraph
Translated by ToiYeuBitcoin

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