Bitcoin Has Dropped To Below $51,000 And Analyst Says Further Downside On The Horizon
Bitcoin (BTC) slipped below the psychologically important $51,000 mark in a 24-hour period leading up to press time late night Thursday and an analyst thinks more pain is yet to come.
What Happened: The apex cryptocurrency by market capitalization touched an intraday low of $50,856.57. At press time, BTC was 0.51% lower at $52,019.04.
In a seven-day trailing period, BTC has fallen 9.57%. From its all-time high of $61,683.86 — reached twelve days ago — the cryptocurrency has fallen 15.77%.
Analysts expect the downwards momentum to continue and are warning that BTC may breach the $50,000 levels.
“Judging by recent events, traders seem happy to be selling into the rallies rather than buying the dip. So, don’t be surprised if we see renewed weakness in the markets later on in the session,” wrote Fawad Razaqzada, market analyst at ThinkMarkets, as reported by MarketWatch.
Razaqzada said that further bad news could be in store for BTC. “The crypto has been correlating positively with risk assets over the past year and if that relationship remains strong then the digital currency could follow risk assets lower.”
Why It Matters: Razaqzada urged Bitcoin traders to exercise caution as according to him “appetite for risk” is slowly fading, MarketWatch reported.
Tesla Inc’s (NASDAQ: TSLA) announcement that it would accept BTC for payments also led to profit-taking, as per Shane Ai, head of research and development at crypto exchange Bybit, Business Insider reported.
Another factor that contributed to BTC’s decline is the expiration of $5 billion worth of options, due on Friday, as per Ai.
The expiration of contracts and some investors pushing the price lower to make money from bets against the cryptocurrency in the options market “have led to spot-selling pressure into quarter-end,” according to the analyst.