The value of Bitcoin dropped below $60,000 after a crash that resonated market-wide, affecting even Ethereum, Binance Coin and Solana, seeing a five to ten percent dip on Tuesday. At the time of writing this article, the value rose ever so slightly and stayed put at $60,687.80.
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This crash comes after just last week when Bitcoin hit an all-time high of around $69,000. According to a report by Independent.co.uk, the overall crypto market dropped over $200 billion overnight -- around $2.6 trillion, after edging really close to the $3 trillion mark during last week¡¯s rally.
There is no clarity on what led to the occurrence of the sudden crash, although there seem to be several factors that could have contributed to this.?
One of them is the crypto mining crackdown that¡¯s going on in China, as well as the rejection of a bitcoin exchange-traded fund by the US Securities Exchange Commission alongside long term investors extracting profits from their holdings.
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The volatile nature of Bitcoin is making it difficult for analysts to predict if this is just a correction on its journey to greater heights or is it the beginning of the reversal of the 2020-2021 bull market.
Nicholas Cawley, an analyst at foreign exchange firm DailyFX, told The Independent, ¡°Bitcoin¡¯s sell-off has taken it back to levels last seen 10 days ago, hardly a plunge, more a correction of the multi-month rally. The one area of concern is that the move lower has seen bitcoin fall out of its multi-week ascending channel, turning the technical outlook from positive to neutral.¡±
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He added, ¡°An interesting area of support is around $59,500 šC if this holds then we may well see bitcoin reclaim its recent losses, and look at printing a new all-time high, over the coming weeks.¡±
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