There are several factors that contributed to the reasons Bitcoin price went below $9K, liquidating $55M.
Last weekend, the Bitcoin price rose above $9,000. It clocked a 22-percent gain from its low price index of $7,524. As the cryptocurrency market investors and experts were anticipating a sharp price gain, the price starts plummeting a week after. There are several factors that contribute to how the Bitcoin price went below $9K.
Within 7 hours, from $9,660 the price of Bitcoin went down to 7%. It slid down as $55 million worth of contracts were liquidated on BitMEX.
Expert watch points out four factors that contribute to the sudden decline of Bitcoin, the top cryptocurrency. The factors are stock slides, miners pressure selling, longer low volatility, and repeat rejection of $10,000.
Worst day for stocks and Bitcoin
Recently, price drops have been a common theme for cryptocurrency and Bitcoin. The worst day happened in two weeks. After a sharp sell-off in the regular market session, Dow drops nearly 3%. Thus, analysts pointed out the bullish condition of the market. It remains to consolidate below resistance at $10,000.
However, analysts warn investors that the shorter-term price solely depends on the wider economy. Thus, Bitcoin condenses on low volume.
Miners sell Bitcoin
Data reports from ByteTree, CryptoQuant, and Glassnode how miners are pressure selling Bitcoin as a whole. Furthermore, the largest inflow exchange in Bitcoin was observed on June 24th. Miners transferred a total of 2,650 BTC to Bitfinex.
Miners have a habit of selling their Bitcoin reserves after a key difficulty adjustment. This miner activity results in putting the Bitcoin exchange market to vulnerability. Thus, there is an expected short-term pullback.
Those miners who sell millions-worth of Bitcoin when the market is on low volatility for weeks will trigger a massive price movement. Even in a short period of time.
Expected price movement due to low volatility and tight range
Since mid-June, the crypto market is in low volatility. Thus, traders are expecting the price of Bitcoin to have a sudden increase. As the interests in future changes continue to increase, there is a growing number of investors expecting the Bitcoin price to move. However, at a pivotal point, the uncertainty between the sellers and buyers resulted in the price to remain on low volatility.
Bitcoin volatility went down to 30 percent and it has been the farthest point of this year.
Repeat rejection of $10,000
For the past 10 months, the Bitcoin price has been playing between $6,000 and $10,000. Since October 2019, the $10,000 price level has been consecutively rejected. Analysts have seen a potential triple top, which would develop if the Bitcoin price will fall below $8,000.
However, there are several traders and investors who remain optimistic for several reasons. Satoshi Flipper, a cryptocurrency investor, continues highly bullish. He believes that even if the Bitcoin price will drop to $7,000, it will rise up to $14,000 in the second half of 2020.
These are the fundamental reasons Bitcoin price went below $9K. More so, it is coupled with the stock movement which may weaken the short-term trend of Bitcoin. However, analysts are still optimistic about a positive trend until the end of the year.