Bitcoin prices showed their strength today by rallying. (Photo by INA FASSBENDER / AFP) (Photo by … [+]
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Bitcoin prices have shown resilience today, rallying after breaking through $30,000 and reaching their lowest since January.
By doing so, the cryptocurrency helped illustrate how much support it has around that key, psychological level.
The world’s most prominent digital currency lost value today, falling from close to $33,000 around midnight EDT to $28,814.75 at roughly 10 a.m., CoinDesk figures show.
After declining to this point, bitcoin was trading at its lowest since January 4, additional CoinDesk data reveals.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
However, after suffering these losses, bitcoin bounced back, rallying more than 15% to reach almost $33,300 this afternoon.
Several technical analysts provided optimistic interpretations of this run up in price.
Katie Stockton, the founder and managing partner of Fairlead Strategies, LLC, noted that “The recovery attests to the support near current levels.”
Further, she stated that “it shows a welcome reaction to oversold indications!”
William Noble, the chief technical analyst of research platform Token Metrics, also weighed in on the matter, emphasizing that while the recent declines have been significant, they aren’t the end of the world.
Even though bitcoin fell through $30,000, it didn’t reach $26,000, which he considers “the ultimate psychological support point” since it is “Michael Saylor's average purchase price” for the digital asset.
Jason Lau, COO of cryptocurrency exchange OKCoin, also offered his input, providing some technical analysis.
“The $30k/BTC range has been tested and shown solid support dating back to early 2021, having been tested and bounced off multiple times now,” he stated.
Lau emphasized that while temporary drops below $30,000 are not a huge cause for concern, if the digital currency trades “below $30k for a significant time,” he “will be tracking it closely.”
Pankaj Balani, cofounder & CEO of Delta Exchange, chimed in, providing an assessment of both market factors and key technical levels.
“Bitcoin bounced sharply from the lows today and is trading close to day’s high,” he noted.
“Unlike the previous times, there is little leverage in the system on the long side currently, this was visible from the gradual drop versus the sharp drops that we saw in mid-May. In fact, naked shorts have started to enter the market and the risk of sharp rises due to short squeezes is higher,” added Balani.
The market expert offered some bullish technical analysis:
“We expect Bitcoin to hold the $30,000-$42,000 trading range for now and test it a few more times before making any decisive move in either direction.”
“The global macro environment is positive and till the time there is a big change in that, we don't expect Bitcoin to break the $30,000 support.”
Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether and EOS.
