The “Bitcoin Halving” euphoria helped the cryptocurrency rise from its mid-March low of $3,858 to as high as $10,079 this Friday. But the so-called bullish event failed to convince traders about sustaining the price above the market’s latest top.
The benchmark cryptocurrency fell by 18.79 percent less than a week after closing above $10,000. Traders seemingly decided to “sell the top” to extract short-term profits, causing the deep price pullback. Data provided by CryptoDiffer showed that exchanges liquidated about $1.22 billion worth of bitcoin positions on May 10 alone.
The liquidations pinched a hole in Bitcoin’s inflating price balloon. The BTC/USD pair recovered in early New York session on Monday – the day of the halving – after Paul Tudor Jones, a billionaire hedge fund manager told CNBC about the 1-2 percent bitcoin holdings in his $22 billion fund. Nevertheless, the price fell at closing hours.
Bitcoin 1D Support
The downside correction over the weekend and the beginning of this week failed to extend below $8,100 – twice in a row. The price tested the said level – once leading to a sharper upside pullback above $9,100. But bears showed an equally-strong resilience as they kept the jump from flourishing into a price rally.
The support level also coincided with bitcoin’s 200-daily moving average, providing an additional layer of flooring to defend the prevailing bullish bias. Meanwhile, a long-term descending trendline held an equally protective stance for bears.
But, according to top analysts, bitcoin has every reason to continue its prevailing bull run. Macroeconomic factors, including central banks’ open-ended stimulus programs and “halving” itself, has led bulls to predict a seven-figure bitcoin scenario.
“Bitcoin could hit $115,212 in Aug 2021 based on the change in the stock-to-flow ratio across each halving,”said Dan Morehead, CEO of Pantera Capital, as he referred to a popular scarcity-based price model.