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How is Bitcoin (BTC) Looking Today?
Bitcoin is currently trading around the $19,600 mark and is showing a bearish trend in the immediate short term. As highlighted in our previous analysis, the main support level for BTC was at the $21,500 mark, which has now been broken with high volume. The break of the support has triggered a sell-off, and the price is dropping rapidly. The $19,600 mark has acted as support in the past, so we can expect the price to take a breather here. However, we are likely to see the downtrend continue, and Bitcoin may touch lower levels before regaining momentum. Let’s take a quick look at the Bitcoin Price Prediction Daily (10-Mar-2023) to see where the price will be headed next in the short term.
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Why is Bitcoin (BTC) Price Down?
Bitcoin’s price is dropping because it’s feeling the pressure from the new banking chaos in the United States. BTC fell around 7% after Silvergate Capital announced it will wind down operations and liquidate its crypto-friendly bank. The news was already anticipated by cryptocurrency investors, but the declines deepened after Silicon Valley Bank announced a plan to raise over $2 billion in capital to offset losses on bond sales. Even though Bitcoin and Ether suffered single-digit drops, the event highlights the end of Silvergate’s role in the industry and its potential impact on liquidity. The situation may consolidate crypto exposure to smaller banks, which could lead to more liquidity and concentration risks.
The Biden administration is also reportedly considering applying the wash sale rule to cryptocurrencies, which would prevent traders from selling and immediately buying back digital assets for tax purposes. In addition, the Public Company Accounting Oversight Board has issued a warning to investors about proof-of-reserves reports, stating that these reports do not provide meaningful assurance and are not audits. Derivatives metrics are being analyzed to understand how professional traders are positioned in the current market. These factors combined have contributed to the price drop we are currently witnessing for BTC.
Analyzing the Charts
If we take a look at the 1-day timeframe, the first thing we can notice is that the price has broken below major support at $21,500. In order to reverse the trend, Bitcoin will have to reclaim this crucial support in the short term.
However, it is highly unlikely that BTC will be able to reclaim this support in the immediate short term. Right now, the price is sitting at the support around $19,600, and it is likely that BTC will break below it in the coming hours. The next level we will be watching in that scenario is the $18,000 mark.
The $18,000 mark has plenty of significance as it was the resistance BTC was facing before the last major breakout. Moreover, it has also acted as strong support in the past.
Conclusion: Final Verdict on Bitcoin (BTC)
Bitcoin is currently trading around the $19,600 mark, and we will likely see it drop further in the coming hours. Right now, we will not be placing any short-term on BTC and will observe the price closely. We are also approaching the weekend, so it is possible that the price will either drop further or consolidate for the next two days. The $18,000 mark is in play, and we will see Bitcoin retest this level in the coming week.
How to Trade Bitcoin (BTC)?
To understand the basics of Bitcoin trading, you can read our How To Trade Bitcoin Guide. It can prove helpful for traders who are just getting started with Bitcoin trading. You can also check out our list of top Bitcoin Exchanges To Trade With.