With the aftermath of the Silvergate disaster still ongoing, crypto watchers are concerned that a price breakdown for Bitcoin could be on the horizon.
Forex.com’s Fawad Razaqzada predicts that the digital currency could dip to the $20,000 mark over the short term, a fall from its current $21,400 level.
Source: FOREX.com
“Unfavourable sentiment and the Fed’s hawkish rhetoric is causing non-interest-bearing assets, such as cryptos and gold, to suffer,” Razaqzada wrote. “A significant sell-off could occur if the $21,400 support breaks.”
The analyst added that the $20,000 mark could be a likely target after a breakdown, with the 200-day average sitting at around $19,700.
Will Bitcoin move higher or lower?
Bulls will be looking to see either a false breakdown below the current $21,400 level, or a move above one of the local highs to create a higher high and break the downtrend.
Razaqzada noted that the key level for bears to watch is the $22,655 high. As long as price holds below this, bears will remain in control.
Silvergate contagion
Crypto stocks are feeling the pain from Silvergate’s voluntary liquidation, with Riot Platforms, MicroStrategy, and Coinbase all down in the wake of the news.
Coinbase has cut ties with Silvergate, and said in a tweet that it has “no client or corporate cash at Silvergate”, adding that “client funds continue to be safe, accessible and available”.
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