Bitcoin Price Falls After Breaking Ascending Support

GlobalBlock CryptoInsight 27/08/2021

By Jonas Luethy

After briefly trading above $50’000 earlier this week, bitcoin has retraced downwards, breaking down from an ascending support line. Bears were put in control as buyers failed to lift the falling price before it found support at the 200-day moving average. Bitcoin is currently trading around $47’300, and analysts have identified $45’300 and $44’000 as the next key support levels should the price decrease further. While the longer-term trend is not clear, in the short term BTC would have to break through the aforementioned ascending support to reverse the trend. A total of 42’500 bitcoin option contracts worth roughly $2 billion are set to expire today, which was likely a major contributing factor to the price volatility and subsequent fall in price this week.

Altcoins mostly followed bitcoin’s price action, ETH is trading at $3100, a fall from almost $3400 a few days ago. Popular altcoin Solana reaffirmed its status as an outlier in the market, making a new all-time high of $83.93 today despite the market trading downwards.

Today the US federal reserve is expected to announce plans for tapering as the US economy recovers from the pandemic. Certain crypto analysts see tapering as an issue for bitcoin speculation as quantitative easing is thought to give investors the liquidity to invest in riskier assets.

NFT sales exploded this month, totalling $896 million dollars in sales or more than triple the previous best month for NFT sales in May. One of the most popular NFT collections, Cryptopunks accounted for nearly $400 million of the volume. Earlier this week, credit card giant Visa purchased CryptoPunk #7610 for 49.5 ETH, worth just under $150’000. Within an hour after the purchase, nearly 50 more of the pixelated avatars were sold and the price floor of Visa’s Punk #7610 rose by $70’000.