Bitcoin Fell Below $30K for the Second Time since mid-May, Low Institutional Demand Could Lead to Further Declines

Bitcoin Fell Below 30K for the Second Time since mid May
Bitcoin Fell Below 30K for the Second Time since mid May

Bitcoin fell below the $30,000 support level for the first time in four weeks. Attributed to the lack of institutional demand for Bitcoin and the large-scale sell-off of the safe-haven Bitcoin caused by the epidemic, the downward trend may be further exacerbated.

Bitcoin has dropped 5.78% during the last 24 hours and has decreased by 10.39% with a week. At the time of writing, Bitcoin was trading at $29,862.62 during the intraday.

Since mid-May, Bitcoin has been locked in a price range between $30,000 and $40,000 level. Due to China’s strong measures to suppress cryptocurrencies, bitcoin briefly fell below the $30,000 mark on June 22. This is the second time Bitcoin has fallen below the psychological barrier of $30K since then.

According to a report released by cryptocurrency data provider Glassnode, the current Bitcoin price continues to consolidate with low volatility.



The UTXO indicator-a trading volume indicator displaying the chain’s pricing range shows that more than 10.5% of the total supply of BTC with a total value of 1.973 million BTC trading between $31,000 and $34,300 level. This transaction volume is much higher than that of trading volume in the range between $50K and $60K.

At the same time, it is worth noting that not many trading supports above $18.8K. If Bitcoin falls further, the trading level of $26.5K will be the first supporting level, followed by $23.3K and $18.8K.

In addition, the market-board correction in May led to a sharp drop in interest from institutional investors.

Take the grayscale GBTC as an example. Last week, the GBTC market discount continued to exist, and the discount range was approximately -11.0% to -15.3%. Although it can be seen from the graph that the degree of discount has slowed down, compared to mid-May due to China, the restrictions on cracking down on cryptocurrency miners have caused a discount of up to 20%, but it is still at a discount.

The net inflow of ETFs for other purposes has also slowed down. According to Glassnode data, the largest net outflow this week since mid-May was as high as 90.76 BTC.

Market analyst Edward Moya said that the fear over the virus pandemic had triggered a general panic selling to all the best-performing assets.

The three major U.S. stock indexes, the S&P 500 Index, Dow Jones Index, and Nasdaq Index, all showed varying degrees of decline, closing down by -1.59%, -2.09%, and -1.06%, respectively.

Moya said that:

“If the stock market selloff intensifies, bitcoin and Ethereum will easily extend their declines”

She also revealed that Bitcoin might be vulnerable to a flash crash to the $20,000 level, but this price level should attract many institutional buyers who have been patiently waiting to see.

Image source: Shutterstock

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