The cryptocurrency market crashed again during the weekend. Bitcoin price dropped sharply overnight, plunging to a low near $41,967.50. In a 24-hour period, Bitcoin lost near $10,000 or more than 17 per cent. Ether, the coin linked to Ethereum blockchain tanked almost 10 per cent to near $3,500 during the same time frame.
A volatile week in the financial market fueled a broad sell-off in the cryptocurrency market. Global equities and benchmark US bond yields tanked during the end of the last week after data showed that job growth in the United States had slowed in November. The rising number of coronavirus cases due to new Omicron variant and newly put curbs across world, kept investors on edge. The last nail in the coffin was the China’s real estate giant Evergrande’s statement, “… there is no guarantee that the Group will have sufficient funds to continue to perform its financial obligations.”
Though the crypto world had recovered with Bitcoin price rising above $51,000, analysts think it might be a good time for investors to take a grab of crypto bite. The world’s largest cryptocurrency is now down by over 25 per cent from all all-time high close to $69,000, which it hit in early November. Bitcoin has officially entered the bear market territory.
Touting the sudden drop in the Bitcoin price as “natural correction,” Vikram Subburaj, member of Blockchain and Crypto Assets Council (BACC) said, “Bitcoin gained more than 60 per cent in the period from September to November and hit an all-time-high of $69,000 in between. Naturally, a correction was bound to happen as investors take some profits out. Such corrections happen frequently in the crypto market and it has always led to more growth and newer ATH. Bitcoin is expected to reclaim $60000 levels by year end.
Bitcoin Fundamentals: What Future Holds for Investors
“Bitcoin was trading in a ‘Descending Triangle’ pattern (Bearish Pattern) where a downward sloping line acts as resistance and the horizontal trendline acts as support (which was at $53,000). The asset was struggling to breach the multiple resistance like 20 Day Moving Average, downward sloping trendline, psychological level of $60,000 and it broke the ‘Descending Triangle Pattern’ on the downside. Bitcoin has a strong support zone from $43,500 to $38,500 and to rally it needs to close and sustain above the resistance zone of $50,000 to $53,000,” said Nirmal Ranga, chief revenue officer, ZebPay.
Cryptocurrency Investors: What to Buy Now
“The investors should fill their positions at $40,000, $30,000 and lower because in the end, it’s a great buying opportunity for long-term buyers. Bitcoin can perform well during the financial crisis or lockdowns like it did last year too,” said Hitesh Malviya, founder, itsblockchain.com, India’s first and oldest blockchain cryptocurrency publication.
“This correction in the market has given a good opportunity for investors to get hold of good tokens at attractive prices. It is important to note that one shouldn’t jump in with all their funds at once. Ethereum is a good buy anything below $4000. Algorand and Matic are also good picks after the correction,” said Edul Patel, CEO & co-founder of Mudrex.
Vikas Ahuja, Member of Blockchain and Crypto Assets Council (BACC) chose Bitcoin, Ripple and Ethereum for investors who are planning to enter the market now.
“Christmas or holiday season is the time when people are taking out money and booking profits bitcoin last year December was around $30,000. Investors should hold or buy since post January demand will increase,” he added.
Bitcoin, Ethereum, and Terra(LUNA) are three cryptocurrencies to consider at these levels, said Hitesh Malviya.