Bitcoin experienced a decline of 3.5% on March 28, dropping to an intraday low of $84,120 after initially starting the week positively. This price rejection occurred near a descending trendline and the upper range of an ascending channel. Currently, Bitcoin is below the 200-day exponential moving average, which may lead to further losses if it closes under this key level. Analysts suggest that if liquidity conditions don’t change, Bitcoin could drop to between $72,000 and $75,000. However, the rising Global M2 money supply might spark a potential rally. Bitcoin has recently filled a CME gap, hinting at a possible short-term bounce, but there are concerns about a long-term correction ahead.
Bitcoin Price Hits a Low of $84,120: What’s Next for Crypto Investors?
After a promising start to the week, Bitcoin (BTC) experienced a downturn on March 28, dropping by 3.5% to reach an intraday low of $84,120. This price rejection occurred just below the descending trendline and at the upper range of an ascending channel, raising concerns among crypto investors.
On the daily chart, Bitcoin has fallen below the crucial 200-day exponential moving average (EMA). If BTC closes below this key Market indicator, it could signal further declines, potentially pushing prices toward the $72,000 to $75,000 range. Recent insights from Capital Flows, a notable macroeconomic analyst, suggest that current liquidity conditions might not be favorable for Bitcoin, as the cryptocurrency is increasingly acting like risk assets.
Investors should note that macro liquidity, which refers to the capital available in the financial system, plays a critical role in Bitcoin’s performance. While Bitcoin shows a connection with traditional risk assets, it remains on the fringes of the risk spectrum. For substantial capital to flow back into BTC, investors might need to shift their focus from safer assets, like bonds, to cryptocurrencies and equities.
Interestingly, there are indications that an increase in the global M2 money supply could trigger a Bitcoin rally. Colin Talks Crypto, a prominent crypto commentator, points out a potential BTC surge around May 1, lasting for approximately two months. Historically, the growth of the global M2 money supply has correlated with Bitcoin’s price movements.
In terms of immediate technical analysis, Bitcoin recently filled a CME gap between $84,435 and $85,000, often a precursor to price corrections or rebounds. However, traders are cautious, with some forecasting a long-term correction that could see prices dip below $74,000.
In a recent social media analysis, a trader stressed that Bitcoin is at a critical juncture. The cryptocurrency needs to maintain its position, or risks falling significantly below $85,000.
It’s important to remember that investing in cryptocurrencies involves risks. Investors should conduct thorough research and analysis before making trading decisions related to Bitcoin and other digital assets.
What does “macro liquidity” mean for Bitcoin prices?
Macro liquidity refers to the overall supply of money in the financial markets. If there is less money available, it might lead to lower Bitcoin prices. Analysts believe that changes in macro liquidity can affect how investors buy and sell Bitcoin.
Why is Bitcoin dropping to $72,000 suggested?
Analysts have pointed out that current Market conditions, influenced by macro liquidity, could push Bitcoin’s price down to around $72,000. This is based on trends and investor behavior linked to the broader economy.
How does the economy influence Bitcoin prices?
The economy affects Bitcoin prices because when people have less money to spend, they are less likely to invest in cryptocurrencies. Factors like interest rates and inflation impact how much money people have, which can cause price changes in Bitcoin.
Is $72,000 a critical price point for Bitcoin?
Yes, $72,000 is seen as an important level by some analysts. If Bitcoin reaches this price, it might attract more attention from traders and investors, either leading to recovery or further drops, depending on Market reactions.
Should I be worried about Bitcoin’s price changes?
While price drops can be concerning, they are part of the natural Market cycles. It’s important to stay informed and consider your own financial situation before making any investment decisions. Always do your research before acting on price changes.