Bitcoin saw a sharp drop today that led to a low of $ 9,200 before returning to the $ 9,000 region. This price action made the cryptocurrency vulnerable to further downturns in the coming days and hours.
It’s important to note that the buyer aggressively confronted this dip with buying pressure, confirming that it has significant support in the region at a lower $ 9,000.
Analysts note that the crypto could see a significant drawback in the coming days and weeks if it doesn’t gain further upside momentum. In fact, an analyst notes that it could drop to $ 7,600 in the short term.
Investor sentiment data suggests that the crypto’s inability to break out above $ 10,000 is leading some investors to anticipate further weakness.
Bitcoin refuses to lower the $ 9,000 region as resistance grows
At the time of writing, Bitcoin is trading just over 3% at its current price of $ 9,400. This is a slight decline from daily highs of just under $ 10,000 recorded around this time yesterday.
The cryptocurrency has been turned down around $ 10,000 several times in recent days and weeks, confirming that it is a heavy resistance level for the digital benchmark asset.
If it continues to struggle to rise above this level for the next few hours and days, it is possible that the strength of the bulls will begin to dissolve – opening the gates for BTC to see a significant drop.
A popular pseudonymous crypto trader came up with this possibility in one recent tweet, in which he explains that he expects a downside that Bitcoin could potentially bottom out in the $ 7,000 region.
“BTC – failed to break out, I would go short again from 96s – 97s. 50% off the initial short, ”he explained, pointing to the chart below.
Investor sentiment begins to humiliate
It appears that Bitcoin’s current weakness is causing investor sentiment to deteriorate – a sign many expect it to see a further drawback.
According to recently released data From Arcane Research, the cryptocurrency’s “Fear & Greed Index” has declined this week from the “Greed” phase to the “Fear” phase.
“The Fear & Greed Index has now dropped to 44 and the market is becoming anxious after a volatile week and is moving back to a neutral state. Although the market was greedy for one day, it quickly returned to fear after bitcoin price topped $ 2,000 in a short period of time last weekend. “
This shift is characteristic of investors who are increasingly anxious that the potential decline overcome by the above trader will flourish.
Featured image from Unplash.