Bitcoin [BTC] price touched a low at $7394 last day as it dropped 4.9% on a daily scale. The charts made a full retrace of 28% (from $10,370) pump following the Chinese news. Xi Jinping’s announcement of progressive growth for blockchain in China created a lot of frenzy in the markets.
According to Datamish, over $270 Million in longs were liquidated at BitMEX in the last 24 hours.
Nevertheless, the buyers seem to have stepped in at $7550. Bitcoin [BTC] derivatives market is finally turning bearish too as the funding rates on BitMEX and BTC basis on Okex are turning negative. It projects that it is much cheaper to go long at the moment as the market is in a strong bearish trend.
Moreover, while the trend is mostly bearish, there is a lack of fundamental positive catalysts at the moment.
It’s the Traders, Not China!
Dovey Wan, a crypto-analyst popular for her on-ground insights from China, shined a light on how news circulates in China. According to her, the Chinese crypto groups on WeChat are close and avoids ‘fake news’ by comments and deliberations from experts. She says,
Usually when west knows abt it the first time, China market already absorbed the news. West can have their own reads (like the Xi thing, recent regulatory tightening etc), the actual severity is always subjective. She added,
“fidelity of news can be proven or disproven relatively fast among small group of insiders”
Her comments are influenced by the recent ‘fake news’ around a police raid at Binance’s Shanghai Office. The officials from Binance are strongly condemning the media outlet for spreading it. Changpeng Zhao, the CEO of Binance tweets,
No police, no raid, no office. Hope you didn’t pay to read that FUD block.
Nevertheless, the reporters from the outlet continue to find some truth in their article and fight CZ’s claims on Twitter.
Is the Bottom in?
Despite the absence of negative news, the drop in Bitcoin’s price last night was not surprising to many investors. The bearish trend has dropped Bitcoin to a potential low where a reversal could be seen.
Moreover, even the pump on 25th October could be mainly attributed to a short squeeze rather than increased buying pressure. Since the trend before the pump was bearish, the traders are now looking for it hold support along with the last swing lows ($7300-$7600). However, A failure to maintain above these levels could take Bitcoin to $6500 levels.
Do you think that Bitcoin’s bottom is in? Please share your views with us.
Disclaimer The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.
Nivesh from Engineering Background is a full-time Crypto Analyst at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com