Bitcoin falls to pre-ETF lows below $60,000
By Noemi Jansana / Alejandra Zamora
Date: Wednesday 27 Oct 2021
(Sharecast News) - Bitcoin suffered sharp falls on Wednesday, losing $60,000 and then $59,000 in the blink of an eye, after being locked in a narrow trading range in recent days between $60,000 and $63,000. Meanwhile, the extremely bullish sentiment seems to be taking a breather. The drops are down 7% for the queen of cryptocurrencies up to October 15 minimums, prior to the launch of the US ETFs, while the rest of the market is also in the red and the total capitalization losses are more than $120 billion, up to $2.4 trillion.
There appear to be no clear reasons for the pullback, beyond trading platform Robinhood shedding 10% in the premarket after reporting that cryptocurrency revenues fell by three fourths in the third quarter. Robinhood registered $51 million in revenue based on crypto transactions during the third quarter, down 78% from the previous quarter, as the company declared.
All in all, experts are asking for calm, as the overall uptrend will be preserved even if the largest asset by market capitalization plunges to $50,000.
As for the 'altcoins', Ethereum is down 5% and has suffered losses of $4,000, while other tokens have taken a greater plunge, reaching 10% for Cardano, Solan or Ripple.
Taking all of this into account, experts are now wondering when we will see a new attack on the recent highs, as the market consensus is still betting that the most traded of the cryptocurrencies will reach $70,000 sooner rather than later. "Bitcoin is relatively flat on Tuesday after bouncing back strongly at the start of the week," notes Craig Erlam, analyst at Oanda.
"Despite a brief dip below $60,000, it held onto that psychologically important support level and is now sitting comfortably above there, which begs the question, when will we see another run at record highs," he states, adding, "There's been lots of positive momentum in the market recently and there's certainly no shortage of crypto headlines right now."
The Bitcoin´s Fear and Greed Index is starting to decline from its highest level in more than seven months, suggesting that buyers are starting to take some profits after a more than 50% increase in the cryptocurrency's price over the past month. What's more, data from Glassnode shows that long-term holders, the 'HODlers' are cashing out, which usually happens when the asset reaches an all-time high.
However, based on the current price cycle, profit-taking by long-term holders appears to be modest when related to the extreme levels seen at the end of a bull market phase, which suggests that the bull market is still underway.
On the other hand, the total balance of Bitcoins on exchanges continues to decline, suggesting that traders are keeping hold of their coins rather than making them available to exchanges.
"In relation to the supply in circulation, the Bitcoin balance on exchanges is at levels not seen since January 2018," 'Arcane Research' wrote in a newsletter on Tuesday. "This could suggest that selling momentum is low at this time."
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