Bitcoin has experienced a sharp decline today which has taken it to lows of $ 9,200 before recovering in the region of $ 9,000. This price action has made the cryptocurrency vulnerable to further disadvantages in the coming days and hours.
It is important to note that the buyer has aggressively faced this decline with buying pressure, confirming that he has significant support in the region of $ 9,000.
Analysts point out that crypto could see a significant downside in the days and weeks to come if it fails to gain momentum on the upside. One analyst even notes that it could drop to $ 7,600 in the short term.
Data on investor sentiment suggests that the inability of crypto to exceed $ 10,000 leads some investors to anticipate further weakness.
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Bitcoin falls to lower region by $ 9,000 as resistance increases
At the time of writing, Bitcoin is trading at just over 3% at its current price of $ 9,400. This is a slight decrease from the daily highs of just under $ 10,000 which were set at that time yesterday.
The cryptocurrency has been the subject of multiple releases of around $ 10,000 in the past few days and weeks, confirming that this is a high level of resistance for the reference digital asset.
If you continue to have trouble crossing this level in the hours and days to come, the strength of the bulls could start to dissolve, opening the doors to BTC to see a significant drop.
A popular pseudonym crypto merchant pondered this possibility in a recent tweet, explaining that he anticipates a downside that could push Bitcoin to lows in the region of $ 7,000.
"BTC: if it is not broken down, it would reconfigure itself short from 96 to 97. Withdrawal of 50% of the short initial discount", he explained by pointing to the graph below .
Image courtesy of TraderXO
Investor sentiment begins to worsen
It seems that Bitcoin's current weakness is causing investor sentiment to deteriorate, a sign that many expect to see new drawbacks.
According to recently published data According to Arcane Research, the cryptocurrency fear and greed index has moved from the "greed" phase to the "fear" phase this week.
"The fear and greed index has now dropped to 44 and the market is getting scary after a volatile week, pushing again to a neutral state. While the market was greedy for one day, it is rapidly returned to fear after the price of bitcoin fell more than $ 2,000 in a short time last weekend. "
Image reproduced with the kind permission of Arcane Research
This change is emblematic of investors who fear more and more that the possible decline reflected by the previous trader will materialize.
Featured image from Unplash.