Analyst Peter Brandt highlights a seismic bearish breakout in the Bitcoin market, which most recently plunged below $58,000 in an explosive correction that caused $4 billion worth of liquidations. Although it has long been seen as a good store of value (that is, as a safe haven for HODLing), Bitcoin recently broke below the 200 exponential moving average, a level that contained bearish downward corrections in previous trends.
The whole crypto-currency circuit is much more volatile than before: in part due to the fallout from Mt Gox’s ‘escape to the south’ of $300 million in funds; in part due to the fears caused by the German finance ministry and other global regulatory pressures; and in part due to a seismic sell off leading to dental-floss liquidity. The Bitcoin price has plummeted, and nearly all the enthusiasts have sold out. But now there seems little in the way of new institutional investment that fuelled the last crypto-currency bull cycle, and remains disappointingly mute about the debacle. Markets are down, but nobody seems to care.
This so-called ‘crypto winter’ has shaken confidence among those who believe that Bitcoin is impervious to legal and economic challenges, and with funds from institutions slackening, the outlook is uncertain – with the potential for any breach in support zones leading to a test of Bitcoin’s lower thresholds.
Source: Investing.com
