The price of Bitcoin (BTC) suddenly fell 3% over several hours on November 4 to $ 13,566 after briefly surpassing $ 14,000.. Coincidentally, the US dollar, gold and stocks collapsed.
Analysts point to the uncertainty surrounding the choice as a catalyst for the sharp correction.
Why the markets fell after rising during the vote count
As the mainstream media actively reported on the vote count, the price of bitcoin and stocks rose. But still, After the vote count ended or the day ended, all risk-weighted assets including the SP 500 futures went into the red.
Tracy Alloway, Bloomberg financial journalist and co-host of Odd Lots, said so It was likely due to what President Donald Trump said. you said::
“SP 500 futures don’t like Trump’s suggestion that he go to the Supreme Court to question the election results. It is now in the red. “
Bitcoin’s recent crash is notable as it fell at the same time as the dollar. When the dollar falls, bitcoin and gold usually rise as both stores of value trade for the dollar.
As Cointelegraph reported, BTC has seen low correlation with other assets, including stocks, over the past few weeks. Hence, the collective correction on most major assets is an unexpected reaction from the market.
What will happen to BTC in the short term?
According to CryptoQuant, Estimated leverage of Bitcoin futures on Binance peaked historical. This indicates that There are more traders than ever before in Binance’s BTC derivatives market.
Ki-Young Ju, the CEO of CryptoQuant, warned to traders on November 4th about the increased volatility due to cascading liquidations. If there are an unusually large number of contracts in the market, this can lead to massive price movements.
In the short term, given repeated rejection of the $ 14,000 level, Traders are prone to market crashes.
There are several key levels of support for Bitcoin in the near future. First, The $ 13,300 area was heavily defended last week. If BTC continues above $ 13,300, it would indicate resistance from buyers.
Second, The $ 13,000 level has been supported by whale clusters since early November. This means that the whales have amassed large amounts of BTC at this level, making it an area of interest for buyers.