Just at the time when every crypto enthusiast thought that worst for Bitcoin is almost over, they faced another jolt, which proves that nothing is more volatile as crypto.
The sustainability of cryptocurrencies was advocated in the aftermath of Russia’s attack on Ukraine, the viability of cryptocurrencies as a shelter is already being tested. Bad week for Bitcoin, since the very first day of March the price of Bitcoin – the most popular cryptocurrency leading the growth of the crypto market worldwide – started dropping at a slow but steady rate. However, on March 3, it started crashing precipitously, and from that day until this morning, BTC has lost 14.65 percent of its market value, falling from $44,031 to $37,578.
The estimated market capitalization of Bitcoin is $724.01 billion now, resulting in nearly $540 billion going down the drain within just three months now.
Bitcoin tumbled in an extended selloff for cryptocurrencies, falling past $38,000. It is almost trading 45% below its all-time high (ATH) of $69,000, on November 10, 2021.
Does it mean that the dip is lucrative enough to buy?
The answer is quite tricky; If bitcoin fails to break through the $37,500 barrier level, it may continue to fall.
- Hourly MACD – The MACD is presently accelerating into the negative zone.
- Hourly RSI (Relative Strength Index) – The RSI for Bitcoin/USD is presently close to 30.
- Major Support Levels begin at $37,000 and go to $35,000, $38,500, $39,800, and $40,000 are the major resistance levels.
- The Fear & Greed Index increased from 22/100 to 23/100 this morning. Despite the increase, the Index remained in the “Extreme Fear” category. Last week, the Index had visited 50/100 levels and the “Neutral” zone before the reversal. For the Bitcoin bulls, the Index will need to move back through to 54/100 to bring $50,000 levels back into play for Bitcoin. A fall to sub-20/100 would deliver sub-$30,000 levels.
Bitcoin is being viewed by cryptocurrency enthusiasts as “digital gold,” a convenient location to deposit funds during times of conflict or calamity. As the rouble has been pummelling by Western sanctions aimed at squeezing Russia’s economy and cutting it off from the global financial system, cryptocurrency trading in Russia has skyrocketed.
According to researcher CryptoCompare, trading volumes between the rouble and major cryptocurrencies reached 15.3 billion roubles ($140.7 million) on Monday, a threefold increase over the previous week.
Rouble-denominated trades using Tether, a so-called stablecoin meant to maintain a constant value, reached 3.3 billion roubles on Monday, the biggest this year and nearly five times more than a week earlier, according to statistics. According to the data, individuals in Russia are hurrying to convert their assets to cryptocurrency.
All of the most recent forecasts, as well as the Bitcoin meltdown, have piqued the interest of individuals who believe they have passed up a fantastic opportunity to invest in Bitcoin earlier. However, the volatility in the cryptocurrency will still be there in markets amid the war between Russia and Ukraine.
On the downside, there is immediate support at $35,000. The next significant support is indicated near $35,000. If the price falls below the $35,000 support level, it may begin a significant collapse. In the aforementioned scenario, there is a possibility of a move towards the $30,000 level.
While determining a fair value for Bitcoin is challenging, it looks that Bitcoin is trading around an ‘acceptable’ value. JPMorgan, one of the big four has put in a lot of research and data to identify a fair value of Bitcoin a few days ago. However, the article also stated that it might rise to as much as $150,000 in the coming years.
Given that cryptocurrency has not been around long enough to be properly tested in times of crisis, it is critical to remember that even gold does not always surge during a financial crisis. Also, keep in mind that a hedge does not need to rise — it only needs to retain its value.
“Every crisis has both its dangers and its opportunities. Each can spell either salvation or doom. – Martin Luther King”
Investors, who have already bet their money on Bitcoin, are now staring at the drop with no hope of seizer anytime soon. On the other hand, experts are betting if it reaches a new year low, falling below $29,807.
It would be interesting to see how the market behaves in the weeks to come, but in the current scenario, experts advise staying away from it. Given the present circumstances, what is your take on crypto volatility? Do you consider bitcoin to be a safe haven at this level?