Bitcoin fell sharply this week and it lost 5% in 24 hours. Forbes notes that this has crypto traders nervous about the important psychological level of $10k.
This is a crucial level that triggers FOMO when it’s surpassed but may cause a mass selling if BTC goes below it.
At the moment of writing this article, the crypto bloodbath continues and the market is all red.
BTC is also trading in the red and the most important coin out there is priced at $10,304.34.
Forbes also brought up Bitcoin’s 2020 bull market, which has seen the BTC price surge from around $4,000 from back in March to $12,000.
This could be brought to an abrupt end if the price moves lower than $10,000 per BTC, the online publication notes.
“Moving forward, it is important to keep an eye on the last zone of defense between $10,000 and $10,500,” Joe DiPasquale, the chief executive of San Francisco-based bitcoin and crypto hedge fund BitBull Capital, said via email.
He continued and explained that “As long as this range is respected, bitcoin is unlikely to see a prolonged bearish spell.”
“The big level that everyone is watching is $10,000,” Mati Greenspan said as quoted by Forbes.
He continued and said that “The crypto market has broken a few psychological levels. When we broke above that level in late July, it was with such force that we never really got to test it as support. Well, this may just be our chance.”
Greenspan also wrote that “if things get really bad we may just get another chance to buy bitcoin below $10,000.”
Potential reasons for BTC’s drop in price
Coindesk analyzes some potential reasons for BTC’s price drop.
They note that BTC fell in sync with the markets, miners are selling BTC and the third potential reason is the booming of DeFi. Check out their original article in order to learn all the details of their analysis.