Bitcoin plunged by more than $1,500 within a few hours yesterday.
Analysts agree that the fundamentals are still bullish and the recent uptrend could continue.
Bitcoin fell by more than $1,500 within a few hours yesterday from the new all-time high of $24,295 to briefly hit $21,815, but managed to stabilize at $22,658 at the time of writing. Thus, the Bitcoin price recorded a minus of 3.44% within the last 24 hours. The market capitalization has fallen to $422 billion, from $439 billion.
“Big Chonis Trading” elaborates that Bitcoin showed the weakest daily close so far yesterday, since breaking through the $20,000 mark. However, he adds that this is not a reason to panic. In his opinion, Bitcoin will continue the recent uptrend as long as BTC trades above the important 20,000 USD mark. Nevertheless, he advises his followers to be vigilant in the coming days to take advantage of further price fluctuations.
Investor legend and constant bitcoin critic Peter Schiff states that investors will sell risky assets like stocks and bitcoin due to the next stimulus package from the U.S. government and invest their capital in the precious metal silver instead. In his opinion, silver is a good store of value to hedge against the Federal Reserve’s inflationary monetary policy.
TraderXO, meanwhile, describes that the weekly RSI (Relative Strengt Index) and Stoch RSI indicate that the market is overbought and that is why there had to be another correction. Nevertheless, he points out in further tweets that the underlying fundamentals remain strong and the recent upward movement could continue.
Glassnode CTO Rafael Schulze Kraft pointed out on Twitter that the number of BTC held on exchanges continues to fall and because of this devevlopment, a supply and liquidity crisis could be imminent. This, in his opinion, is a bullish sign for Bitcoin that could impact the price in the coming months:
Bitcoin is in a supply and liquidity crisis. This is extremely bullish! And highly underrated. I believe we will see this significantly reflected in Bitcoin’s price in the upcoming months. Let’s take a look at the data.