How Low Bitcoin Price May Plunge Amid Market Correction?

7Ary...USep

17 Mar 2024

Bitcoin Price: BTC, the leading cryptocurrency by market cap, witnessed a notable supply pressure on the weekend leading to an immediate reversal from its new all-time high of $73750. The bearish turnaround evidenced by three red candles plunged the asset 9.63% down to currently trade at $66777. However, market experts perceive this sell-off as a natural pullback in an established rally to regain bullish momentum.
Also Read: El Salvador Sets Bitcoin Piggy Bank With $400 Mln Bitcoin

BTC Price Sustainability Questioned by Leverage Concerns

Bitcoin Price| Tradinview
BTC
$66178.8532
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Within the last two months, Bitcoin has witnessed an aggressive rally, registering a price from $38555 to a new time high $73,750. This 91% upswing accompanied by increasing volume and massive inflow through BTC ETFs indicated a sustainable rally.

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However, the analytics platform IntoTheBlock has reported a surge in crypto leverage, noting that Bitcoin’s borrowing costs on exchanges such as FBnance and Bybit have reached their highest points since 2021. This rise in borrowing rates may suggest increased trading activity where traders are taking on more debt to finance their positions, which some market participants interpret as a signal of an overheated market.

Thus, the Bitcoin traders experienced a sudden selling on the weekend resulting in a price drop to $66925. With a 3.63% intraday loss, the buyers seek support at the 23.6% Fibonacci retracement level- a tool that provides traders with potential demand zones amid a correction trend.

If the supply pressure persists, the Bitcoin price may plunge to $60300 or $56200, which coincides with 38.2% and 50% FIB levels.

Historic Pullback Patterns Suggest Potential Bitcoin Correction to $45.5K

In recent crypto market observations, the pseudonymous trader known as Bags has provided a notable analysis regarding Bitcoin’s historical pullbacks coinciding with its halving events. According to Bags, Bitcoin has experienced a consistent pullback of 38% in its first two cycles. Despite the third cycle’s volatility, attributed to the COVID-19 pandemic—an outlier that the analyst suggests disregard—the same 38% pullback pattern is observed.
Amid the current market, applying the identified pullback pattern to Bitcoin’s recent peak of $73.5K, Bags calculates a correction target of $45.5K.

Technical Indicator

Exponential Moving Average: The fast-moving 20 EMA slope provides buyers with dynamic support to prolong the recovery trend.
Moving Average Convergence Divergence: A bearish crossover between the MACD(blue) and signal lines accentuates the sellers’ strengthening over this asset.

Will XRP Price Lose $0.6 Support Amid Market Correction?

Amid the recent correction trend in the crypto market, the XRP price rally witnessed an immediate reversal from the $0.745 mark. Within 5 days, the Altcoin values tumbled 16.5% to reach the current trading price of $0.62. Will the demand pressure at a 50% retracement level, offer buyers an opportunity to counter-attack or further correction is underway?
Also Read: Ripple Role Questioned as USDC XRP Ledger (XRPL) Integration Lags

XRP Price Facing the Fallout Below the 50% Retracement Level

XRP Price| Tradingview
XRP
$0.61026965
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XRP, the digital currency of the Ripple network, is riding a short-term rally under the influence of an ascending support trendline. This dynamic support has uplifted the altcoin value from a February low of $0.49 to a recent high of $0.74, registering a 51.8% growth.
The chart projecting several reversals from this support indicates the buyers continue to accumulate this asset in market dips. As of now, the crypto market is experiencing a similar situation with the Bitcoin price correction below the $70000 mark.

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Thus, the XRP price of $0.612 showcased an intraday loss of 3.44%. This downtick teases a bearish breakdown from the 50% retracement level which wavers around $0.615.
A potential breakdown below this support may hint at the weakening of this bullish momentum, while a break below the support trendline will accelerate the selling pressure on this asset.
Should this happen, the XRP price may plunge another 10% to test support region near $0.52.

Also Read: XRP Whales Move 67 Mln Coins Amid SEC vs Ripple Lawsuit Relief

Key Support Levels to Watch

An analysis of the daily chart shows the XRP price has respected two key support trendlines, a steady one marked in blue and the less inclined black. The price sustainability above the former would indicate the near trend is aggressively bullish. On the other hand, the lower one is active for over 400 days projecting the long-term rally in this asset.

BB Indicator Band: The price below the midline of the Bollinger Band indicator reflects the sellers are strengthening their grip over this altcoin.
Moving Average Convergence Divergence: A bearish crossover between the MACD(blue) and signal(orange) signals an active correction phase.

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Sahil is a dedicated full-time trader with over three years of experience in the financial markets. Armed with a strong grasp of technical analysis, he keeRead more…