Over the past hour, Bitcoins (BTC) rose to $ 10,180 on BitMEX, then quickly dropped to $ 9,600. Rapid rejection means that for the third time in 30 days, the Bitcoin price has dropped to the $ 10,000 resistance level.

There are three factors that can contribute to instability: the Federal Reserve meeting of the Federal Open Market Committee, the settlement of short contracts worth $ 14 million and the maintenance of stability in long-term resistance ranging from $ 10,000 to $ 10500.

Fed meeting
The Fed held a meeting of the Federal Open Market Committee before the sudden increase in Bitcoin volatility. During the meeting, Federal Reserve Chairman Jerome Powell said that the job market may have bottomed out.

Since March, the founding investors have been cautious about the short-term development of the stock market due to the labor market situation.

Initially unemployment was estimated at two numbers, and this was a serious problem for high-income investors. To protect themselves from the risk of falling prices, these investors resorted to safer alternatives, such as low-risk bonds.

According to market analyst Welt-Holger Zchibitz, Powell said:

We want investors to assess risks as markets do. [He] says that the Fed will never refuse to support the economy because he believes that wealth prices are too high. Jumping asset bubble will hurt job seekers. ”

Despite positive data from the FOMC meeting, both the US stock market and bitcoin price fell afterwards.

The trend with the largest digital assets in CoinMarketCap and stocks indicates that once the Fed meeting closes, news emerges.

Bitcoin futures worth $ 16 million
During a 30-minute period, only $ 14 Bitcoin shorts on BitMEX were discarded. Compared to other exchanges, the high price of BTC on BitMEX increased by about $ 100.

When Bitcoin reached $ 9,600, down 4% in less than 15 minutes, another $ 2 million was paid.

For an hour, futures are about $ 16 million, respectively.

Given the low volume of spot trading in the bitcoin market since the beginning of May, the futures market represents a significant portion of the daily BTC volume.

When tens of millions of dollars of futures contracts are liquidated in a very volatile price movement in a short period of time, this can lead to a rapid change in the price of BTC in both directions.

His long Bitcoin opposition once again defended him
Since mid 2019, a range of $ 10,000- $ 10,500 has served as a strong resistance area for Bitcoin. Every time the BTC price tried to get out of this area, he was facing a brutal pullout.

Recently, the price of Bitcoin exceeded $ 10,000, a significant drop to $ 9,600. Digital currency investor Korieh A.K. He said that the move lowered the value of $ 9,850 as another resistance level.

He said:

“This step was important. $ 9,850 is now less important as a resistance. $ 10,000 is more important now.”

In the short term, a sudden increase could weaken the barrier BTC must break to see an extended meeting. However, it makes BTC subject to more severe withdrawal, since it is located in an important area of ​​liquidity.

Source: CoinTelegraph

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