The price of Bitcoin saw a sharp drop of more than 15% in the span of an hour, reaching the lowest point since mid-June. The dramatic decline happened yesterday afternoon as the price fell from $9,352.89 to below $7,800.
While analysts foresee more Bitcoin struggle in the upcoming days, a recovery is likely based on similar developments seen in 2017. Cryptocurrency trader Marvin Chebbi writes: “A break down of the descending triangle doesn’t necessarily mean the end of the bull market. We had a similar price action in June ’17 with some sort of descending triangle formation (lower highs+equal lows) that broke down, found support a bit lower, [then recovered.]”
This is not to say everyone is taking the drastic price drop lightly. The Crypto Fear & Greed Index, a crypto-market indicator, turned red today as it dropped down to 15, indicating “Extreme Fear” following Tuesday’s collapse. Financial analyst Peter Schiff also foresees more troubles for Bitcoin, writing “Bitcoin has finally broken below the support line of the large descending triangle it has been carving out for months. This is a very a [sic] bearish technical pattern, and it confirms that a major top has been established. The risk is high for a rapid decent [sic] down to $4,000 or lower!”
Meanwhile, reports show that investors are turning to gold, which outperformed the leading cryptocurrency today. This turn of events comes in the wake of news that President Trump has allegedly contacted Ukrainian high officials about planning an interference in the upcoming U.S. presidential elections.
One of Bitcoin’s main competitors, Ethereum, on the other hand, saw one of its most successful days last week, marked by a rise of over 10%. It is too early to tell whether this marks the beginning of a trend of if it is merely a momentary rebound.