The Bitcoin (CRYPTO:BTC) price is down about 1% since this time yesterday, currently trading for US$43,232 (AU$61,311).
That puts the world’s biggest crypto by market cap down 9% so far in the calendar year and down 37% from its 10 November all-time high.
More importantly, perhaps, the Bitcoin price remains down from US$47,000.
Why is US$47,000 an important level?
If you bought Bitcoin anytime over the past 5 months, odds are you’re nursing a loss today.
Why?
Because according to Blockforce Capital, US$47,000 is the average price crypto investors paid for the token over the past 5 months.
As Bloomberg reports, Brett Munster, portfolio manager at Blockforce Capital says that crypto investors who bought in since mid-September could be hesitant to buy any more until the Bitcoin price goes higher and they can at least recoup their initial investment.
The indicator, called a short-term cost basis, is an “impediment to creating some consistent momentum,” Munster says.
The Bitcoin price today is also hovering near the tokens 200-day moving average (MA).
While that’s a coincidence, Munster says the 200-day MA is “a widely recognized indicator for determining which direction markets are trending in”.
With the 200-day MA for the Bitcoin price aligning with the price the average investor will have paid for the token over the past 5 months, “this threshold could provide resistance as those recent buyers may look to recoup their investment and sell off,” Munster says.
Where to next for the Bitcoin price?
The Bitcoin price hit a recent low of US$33,725 on 24 January, according to data from CoinMarketCap.
The big question for crypto investors now, is where is the token likely to head next.
According to Munster (quoted by Bloomberg):
While it’s still too early to declare with any certainty that $33k was the bottom, there is reason to believe that there is now much more asymmetry to the upside than downside. That doesn’t mean Bitcoin couldn’t fall back down again, but the data seems to suggest that the upside potential now outweighs the downside.
The post Is this ‘impediment’ holding back the Bitcoin price? appeared first on The Motley Fool Australia.
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More reading
- Could Bitcoin (CRYPTO:BTC) be eyeing off a $150,000 future?
- Bitcoin price rally fizzles. Here’s what the experts are watching for next
- The best cryptocurrency exchanges for Australians
- $3.6 billion crypto heist thwarted, sending this obscure cryptocurrency skyrocketing
- This global financial giant is buying up Bitcoin. Could ASX banks be next?
The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Bitcoin. The Motley Fool Australia owns shares of and recommends Bitcoin. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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