The celebration of Bitcoin bulls for bringing the price above $10,000 was nothing but shortlived as the leading cryptocurrency collapsed to $8,500 in less than five minutes.
Bitcoin Nosedives to $8,600 on BitMEX
Those who have been involved in the cryptocurrency field long enough probably know that there’s rarely a dull day with Bitcoin.
In today’s early hours, the leading cryptocurrency broke the coveted $10,000 level to reach as high as $10,500, shattering essential resistance levels on the way up. Following that, it settled for a few hours around $10,100, causing many to believe that it’s preparing for yet another leg up.
This, unfortunately, was not the case. Just now, in a violent red 5-minute candle, Bitcoin lost a significant chunk of its value, dropping to as low as $8,600 on BitMEX, completing a textbook Bart trading pattern.
As seen in the chart above, the price has since settled at around $9,500. It’s worth noting that this candle wasn’t as violent on other exchanges.
Even though the drop was considerable altogether, on Binance, the price plunged to $9,400. In any case, with the recent developments, Bitcoin is once again below the crucial descending trend-line at around $9,700 and $9,750. To resume its rally, the price would have to overcome this important resistance first. And then, of course, comes the coveted $10,000 mark, which seems to be a serious challenge for the cryptocurrency.
Altcoins Dragged Down
As it’s almost always the case, altcoins were also decimated in the process. Most of them were recording considerable 24-hour gains, but now the picture has changed entirely.
As seen in the above image, Ethereum lost about $16, which is about 7% less than what it was trading at minutes ago. The same is true for all the other large-cap cryptocurrencies, all of which lost a considerable amount.
The best indicator is perhaps the total market capitalization itself, which lost about $14 billion during the sudden drop.