After Updating the Historical High, the Price of Bitcoin Collapsed by 14%

FXOpen

Bitcoin's previous all-time high price, recorded on November 10, 2021, was around USD 68,900 per coin (depending on exchanges).

But yesterday, the price of Bitcoin exceeded 69k! However, the jubilation from the new historical peak quickly gave way to fear — as the BTC/USD rate began to fall rapidly. From peak A to low B – the price traveled a path of more than -14% in just 5 hours.

These events highlight 2 characteristic features of the cryptocurrency market:
→ Excessive volatility, which is not typical for the stock and foreign exchange markets. For comparison: on October 19, 1987 — Black Monday — the S&P 500 index fell by about 20.5%. After this incident, there were no days when the drop exceeded 14%.
→ Emotionality of the market and the importance of psychological levels. At these levels, the price of Bitcoin often makes false punctures. Yesterday, there were 2 such punctures: a false bullish puncture of the 2021 top, and a false bearish puncture of the round level of 60k dollars for Bitcoin.

It is also worth noting that yesterday’s low was strengthened by support lines:
→ Fibo level 50% of the rally 0→A.
→ The lower border of the ascending channel (shown in blue).

Technical analysis of the Bitcoin chart shows that the price continues to move in an ascending channel, moreover, the price has returned to its upper half. It is possible that yesterday's sharp decline, which saw over USD 400 million in long positions liquidated across 8 major crypto exchanges, is an extremely aggressive form of correction that occurred as part of the current uptrend. If so, then in March we may witness new hikes in the price of Bitcoin to historical peaks.

FXOpen offers the world's most popular cryptocurrency CFDs*, including Bitcoin and Ethereum. Floating spreads, 1:2 leverage — at your service. Open your trading account now or learn more about crypto CFD trading with FXOpen.

*At FXOpen UK and FXOpen AU, Cryptocurrency CFDs are only available for trading by those clients categorised as Professional clients under FCA Rules and Professional clients under ASIC Rules respectively. They are not available for trading by Retail clients.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

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