The price of the world's major cryptocurrency, bitcoin, has pulled below the crucial $36,000 support level, amid global regulatory crackdowns and environmental concerns.
The crypto was trading down more than 5% on Saturday, at $35,697 per coin. Its value has almost halved from April's record peak of about $65,000 a token. Traders forecast $32,500 as the next stop before it revisits its low of $30,000.
Bitcoin's slump comes as traditional markets faced another day of downward pressure, amid comments from the US Federal Reserve about the possibility of raising interest rates sooner than expected. The tightening of regulation on cryptocurrencies in China has been also putting a squeeze on the price.
Analysts say the continuous price decrease is the so-called "death cross" that occurs when the 50-day moving average crosses below the 200-day moving average. The event indicates the potential for a major sell-off. If that happens, bitcoin could enter bear market territory, akin to what happened in 2018.
Bitcoin's previous death crosses resulted in additional price declines of 70% in 2018 and 47% in 2019. The death cross in 2020 occurred shortly after the Covid pandemic-induced market crash in March.
"Speculative reports suggest that bitcoin could soon drop to $20,000, referencing the looming bearish cross of the 50 and 200 daily moving averages," head of markets at brokerage firm ITI Capital, Stephen Kelso, told CoinDesk.
According to the executive director of crypto hedge fund ARK36, Ulrik Lykke, quoted by CNBC, "The crypto markets are currently processing a cascade of news that fuels the bear case for price development."
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