Bitcoin Price Abruptly Fell by $500 In Seconds

Suzat

August 10, 2020 5:45 pm

Bitcoin Price Abruptly Fell by $500 In Seconds
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On August 10, Bitcoin (BTC) fell several hundred dollars in seconds as $12,000 once more proved too hot to handle.

Cryptocurrency market daily snapshot Aug. 6. Source: Coin360

Bitcoin Price Gains New Focus at $11,700

During Monday trading, data from Coin360 confirmed BTC/USD nosedive 4%, jumping off $11,500 and since returning to $11,700.

In doing so, BTC easily filled the latest gap in CME Group’s Bitcoin futures markets, which lay just below $11,700.

BTC/USD 1-day price chart. Source: Coin360

Data from monitoring resource Skew confirms that the event caused a dramatic spike in liquidations on derivatives giant BitMEX.

BTC/USD liquidations on BitMEX. Source: Skew

Bitcoin Returning to the Pattern of Behaviour

Michaël van de Poppe, markets analyst, the sudden dip suggested that Bitcoin was returning to the pattern of behaviour seen in recent months. He told Twitter followers:

“Smaller timeframe chart explaining what just happened. Essentially, we’re back into the ranging gameplan” 

“Ranging” within a certain price corridor has become a feature of BTC/USD in 2020, with recent gains upending a protracted period, which slowly narrowed to point, a process known as compression.

Moving forward, lower levels could see a retest, with significant support just above $10,000 still apt to form the price floor, Van de Poppe thinks. Also, he continued “Larger timeframe; still expecting such a scenario.” 

“If we break $12K however, I assume we’ll see $13k.”

Attention will thus now focus on the bulls’ ability to cement $12,000 as a support zone, something which has yet to occur on any meaningful level for BTC. Although, since January 2018, the newest weekly close noted the highest and the initial fall from Bitcoin’s all-time highs of $20,000.

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