Major institutions, such as Tesla and MicroStrategy purchasing bitcoin, rising yields, and stock market drop have started to influence crypto space.
Bitcoin halted its bull run in recent weeks after the price corrected from an all-time high of $58,000 to roughly $43,000.
Nischal Shetty, CEO of WazirX, stated that this week, the crypto ecosystem had experienced many exciting things. Bitcoin rebounded above the $50,000 zone. Besides, Microstrategy announced buying additional 328 bitcoins for $15 million. Citigroup called BTC the North Star asset.
However, Bitcoin has not been able to recover to its record high. Various arguments were found for this setback, including a sell-off of miners and whales. The other main reason for this correction is the sudden rise in returns around the world.
Today, bearish support and resistance swing have been taking place, suggesting further short-term weakness.
This bearish support/resistance change has occurred at the $55,000 and $ 52,000 levels, with the latter serving as the main current resistance area.
In recent days, the price of Bitcoin tried to break out of this resistance zone but failed. After such a failed breakout, retesting the lower levels seems inevitable.
In that perspective, the critical support zone for Bitcoin is the area between $48,300 and $48,800. As long as they hold, a retest of the $52,000 zone could happen.
If the support zone is not held, the low range is likely to receive a renewed test. Therefore, the correction does not appear to be over for the price of Bitcoin. Also, March’s month is not the best period for Bitcoin, so the current drop in prices should come as no surprise.
March is reputed to be a lousy month for cryptocurrencies.
Simultaneously, other major cryptocurrencies such as ether and ripple were also trading in the red.
Historically, March is a terrible month for cryptocurrencies, as the last few years have shown general weakness during this period. Such corrections often end at the 21-week MA. According to analysts, it is the critical indicator for watching bulls and supporting market momentum.
As long as Bitcoin price remains above the 21-week MA, it is likely to be bullish. The 21-week MA is currently at $29,000, but within a few weeks, it will be between $33,000 and $35,000. As long as Bitcoin remains above that $30,000 area and the 21-week MA, investors shouldn’t worry about the general uptrend.