Bitcoin (BTC) has seen significant momentum in the past few weeks. as its price neared its precious all-time high of $ 20,000. But still, This glorious rally ended abruptly The price of Bitcoin has dropped sharply in the past 24 hours.
While most investors were celebrating a potential new all-time high, Bitcoin price fell from $ 19,500 to $ 16,300, a decrease of 15% in less than 24 hours. Most cryptocurrency markets followed suit as well Altcoins in dark red across the board on November 26th.
Bitcoin is losing a crucial level of support and is falling sharply
The critical area for maintaining between $ 18,400 and $ 18,700 was lost. This area was vital as a support for several reasons. The first is the instant failure of the uptrend.
If Bitcoin’s price fell below this support level, This means that the uptrend of reversing any resistance before support has failed.
As the graphic shows The collapse sparked a bearish chain reaction. This is the second reason The loss of this level triggered many stops / losses that fueled the decline.
Before, Many traders should expect a further upward trend as the financing rates on most exchanges were cheap. This breakdown and the impending chain reaction of stop / loss triggers are a typical result of a trend reversal.
Actually, It is quite common for market corrections not to go smoothly. They are often vertical and painful. Up the stairs, down the elevator.
Total market capitalization should correct itself to $ 400 billion
The weekly chart of total market capitalization for cryptocurrencies shows a much clearer perspective.
In this way, Total market capitalization hit the Fibonacci level of 1.618where the resistance met, similar to $ 600 billion.
Even more important is the total market capitalization set a new higher high, crossing previous resistance zone at $ 400 billion.
That $ 400 billion hiatus was the first hiatus in more than two years as that level has been a difficult hurdle in recent years.
So, a correction back to this resistance level to confirm that new support should almost be expected and certainly healthy at the start of a new bull cycle.
More importantly, A correction towards this level would also coincide with the 0.35-0.382 Fibonacci regionthat is often used by traders and investors to search for potential listings.
What level should you watch out for with Bitcoin?
The Bitcoin pricing table shows a breakdown below $ 18,500 to $ 18,800 and that is immediately the main resistance to breakage when the market turns bullish again.
Regardless, The region between $ 15,800 and $ 16,300 is a major support zone for sustaining and it currently stands as one in the daily timeframe.
With this in mind, a new range is being established. As long as Bitcoin holds support above $ 15,800–16,300, the bull market is likely to resume.
However, if you do not hold the bracket, then another correction towards USD 13,800–14,200 should be expected. This level is the high of summer 2019 where the next bullish support / resistance change may come.
In the higher time periods, the $ 18,000-18,200 hurdle is the first clear hurdle to break, as this was the level Bitcoin price failed to break today as it rallied. If that breaks down, the next area to watch is $ 18,400-18,800, which is where today’s bearish chain reaction began.
The views and opinions expressed here are solely those of author and do not necessarily reflect the views of Cointelegraph. Every investment and trade movement involves risk. You should do your own research when making a decision.