The Bitcoin (CRYPTO: BTC) price is in the red again.
The world’s biggest cryptocurrency by market cap is down 3% over the past 24 hours, currently trading for US$36,967 (AU$52,752).
While that’s an improvement from last Tuesday’s lows of US$33,317, the Bitcoin price remains down 22% so far in 2022. And it’s down 46% from its 10 November all-time high.
With investors selling down most risk assets in preparation for likely interest rate hikes from the US Fed and, further down the road, the Reserve Bank of Australia (RBA), the question now is, where will it find support?
How low could it go?
There’s nothing written in stone – or binary – that guarantees the Bitcoin price won’t go to zero.
However, some industry experts believe it’s unlikely to fall below (or much below) the levels it was trading at following China’s crypto ban in May. Namely right around US$30,000. Which would see any crypto investors who bought into the token near its November highs nursing more than 50% losses.
According to Simon Peters, markets analyst at multi-asset online trading platform eToro (quoted by Bloomberg):
A 50% fall down is not as significant as what we have seen in previously years gone by, but it’s significant now so it’s more of a concern. The real support level seems to be around the $30,000 level, where we tested back in May after the Bitcoin mining ban in China.
Explaining the causes of the deflating Bitcoin price alongside the host of altcoins, Avi Felman, a portfolio manager at BlockTower added:
Crypto market capitalizations across the board became hugely inflated and priced in a tremendous amount of growth due to a dovish Fed, and the tightening path the Fed is pursing is bringing liquidity out of the system and resetting outlandish valuations that weren’t keeping up with true usage.
How has the Bitcoin price been tracking?
In an indication of the continuing volatility in the crypto sphere, over the past 12 months the Bitcoin price has traded as low as US$28,894 and as high as US$68,790.
Investors who bought into the token at this time last year, when the Bitcoin price stood at US$33,500 will be sitting on virtual gains of some 10%.
The post Bitcoin price sinks again. Here’s where it could find support: expert appeared first on The Motley Fool Australia.
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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and recommends Bitcoin. The Motley Fool Australia owns 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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