Bitcoin price continued to remain under $42,000 on January 10. The world’s biggest cryptocurrency by market capitilisation snapped a six-day losing streak and avoided dropping below the key psychological level of $40,000 on January 9. However, bitcoin lost some of its gain in the last 24 hours. The cryptocurrency dropped 0.28 per cent in a day to trade at $41,960 at 0830 hours on January 10, according to CoinMarketCap. The cryptocurrency price has fallen below $40,000 for the first time during last week since September 2021. It tumbled around 40 per cent from its all-time high of near $69,000 reached in November, 2021 last week.
January is usually considered a weak month for bitcoin but the recent drop was quite harsh, even for 13-year old cryptocurrency. Many analysts suggested even a steeper sell-off for world’s oldest cryptocurrency.
“On the daily timeframe, Bitcoin can be seen trading within a descending channel pattern. Immediate support is expected at the $40,000-mark. The RSI is also at its lowest since May 2021, indicating Bitcoin is in the extreme oversold zone. Meanwhile Bitcoin whales are making most of this dip and continue to accumulate Bitcoin. The whale activity has increased considerably since November of 2021,” said WazirX trade desk.
“Bitcoin hasn’t been able to get the support it usually sees at the top of the month, and correlations broke down a bit, which is why we have seen the asset continue to slide downwards since the start of the year. Given that Bitcoin is the king of the crypto space, and it has been under performing for a while now, it would be safe to assume that the next rally would most likely have to be a BTC led one. For Bitcoin, support 2 at $35,000, Support 1 at $40,000, Resistance 1 at $45,000 and Resistance 2 at $53,000,” said ZebPay trade desk.
The cryptocurrency market roiled on January 7 as minutes of the latest US Federal Reserve meeting raised the possibility the central bank could boost interest rates as soon as March. While Tether and Solana were still in red on Monday, Ether and Binance gained a little in the last 24 hours. Ether, the second-largest cryptocurrency in the world, rose 0.54 per cent in a day to $3,155 on January 10. Binance Coin was trading at $439,63, up 1.01 per cent in the last 24 hours. “The past week saw massive liquidation across crypto exchanges. The weekly trend pattern for Ether is trading at the support level. Immediate support is expected around $2,730. We can expect a bounce back in the crypto markets after a continuous 7-day correction,” said WazirX trade desk.
“Ether has fared better than BTC so far this year, both in terms of price thresholds, but also inflow that the asset has been witnessing. For support 2 is at $2,950, support 1 is at $3,350 and resistance 1 is at $3,650 and resistance 2 is at $4,150,” according to ZebPay trade desk.
Assuring the investors, Edul Patel, CEO and co-founder, Mudrex- A Global Crypto Trading Platform said, “Bitcoin price dropped from $47,000 to $40,000 in just a week. Looking at the graph, the next floor would most likely be $39,000. This trend in the cryptocurrency market is nothing new as we all saw BTC falling from $57,000 to US$31,000 in June last year. But later it reached its all-time high to $68,000 in mid-November. This downfall over the week may be due to various reasons, such as the shutting down of Kazakhstan’s internet, aggressive Federal Reserve policy action, inflation, fear of regulation, Bitcoin scam in Pakistan, and uncertainty over the new Covid variant.”