Bitcoin has seen some incredibly bearish price action over the past 24-hours, with the cryptocurrency losing its support at $9,500 and entering a full-blown downtrend as bears attempt to erase much of BTC’s recent gains.
It now appears to be increasingly likely that Bitcoin will see some further downside in the near-term, with multiple analysts noting that this retrace may cut deeper before BTC finds enough support to start climbing higher.
There are a few simple factors, however, that seem to point to the possibility that BTC is about to see significantly further losses, which could send it reeling to fresh year-to-date lows.
Bitcoin Plummets Below $9,000 as Analysts Eye Multiple Key Support Levels
At the time of writing, Bitcoin is trading down over 6% at its current price of $8,770, which marks a notable decline from daily highs within the mid-$9,000 region, and an intense drop from weekly highs of over $10,000.
The catalyst for the ongoing selloff seems to have been the cryptocurrency’s swift rejection at $10,000 that it faced this past Sunday, which seemed to confirm the bearish market structure that was developing as a result of its flash crash seen exactly one week ago.
DonAlt, a prominent cryptocurrency analyst on Twitter, explained in a recent tweet that BTC is now approaching a few strong support levels, but he still anticipates it to continue declining until it reaches roughly $8,000.
“BTC update: Falling knife slicing through hands left and right. Approaching interesting areas, this isn’t really the worst place to take some profits and I might close a quarter into this weekly support here. Rest is still headed for roughly 8k,” he explained while pointing to the levels on the below chart.
Falling knife slicing through hands left and right.Approaching interesting areas, this isn't really the worst place to take some profits and I might close a quarter into this weekly support here.
Rest is still headed for roughly 8k. pic.twitter.com/Lgkeniu6ru
— DonAlt (@CryptoDonAlt) February 26, 2020
These Factors Show Significantly Further Losses Could be Imminent
In addition to showing blatant signs of overt technical bearishness, there are a few factors that show Bitcoin’s yearly bottom may not be in.
Mac, a prominent crypto trader, mused these factors in a recent tweet, telling his followers that BTC’s open interest, basis, and high funding are all worse than that seen in October of 2018.
“Legit boys, $6k might not have been the bottom after all. This OI, Basis, Funding is worse than Oct 2018,” he bearishly noted.
Legit boys, $6k might not have been the bottom after all.
This OI, Basis, Funding is worse than Oct 2018
— Mac ($OGN next $MATIC) (@MacnBTC) February 26, 2020
Unless bulls are able to step up and catalyze a significant amount of buying pressure, it does seem that further downside is imminent.
Featured image from Shutterstock.