Bitcoin’s recent significant drop below its 200-day moving average indicates a potential short-term downside, with the $20,000 range once again on the horizon, Business Insider reported.
Katie Stockton of Fairlead Strategies suggests the next key support level for Bitcoin BTC/USD lies around $25,200. If the digital currency breaks below this level, it could potentially plunge down to $20,600, suggesting a 21% downside from current levels.
“As it stands, the weekly stochastics point lower amidst weak intermediate-term momentum, supporting a breach of $25,200 support. We remain long-term neutral, but we are wary of negative catalysts that could develop from a bigger retracement,” Stockton noted.
The cryptocurrency has seen some turbulence this year, soaring from $16,000 to $32,000 between January and July, followed by a decline to its current level. Furthermore, Bitcoin’s fall coincides with a swift decline from just under $30,000 to about $26,000 following news of SpaceX unloading its Bitcoin holdings.
While the SEC is still evaluating applications from BlackRock and Fidelity for a spot in future Bitcoin ETFs, there are no hints yet of approval. Bitcoin’s position remains shaky if the technical support levels are not held firmly.
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