Where Is The New 2021 Bitcoin Bottom?

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Back in January of 2020, when we were still reading about this strange new disease creeping up in Wuhan, China, Bitcoin traded around $8,000. A few weeks later, when it became obvious that the new disease was becoming a pandemic, Bitcoin fell to $4,000 as investors panic sold stocks and crypto.

The rest of 2020 is stuff of legends for crypto as Bitcoin leapt higher to end the year around $29,000. In April of this year, it even touched $64,000.

Ever since then though, as China increased the pressure on Bitcoin, the ESG fans spoke of its devastating effect on climate (highly exaggerated) and Elon Musk seemed to fall out of love, Bitcoin tumbled back down and seems to be headed to the level at which it started the year, some $29,000.

What is driving force?

It remains unclear as to what exactly is the big reason for Bitcoin’s fall in recent weeks, but there is no more denying that this selloff could become a deep correction. A handful of recent developments seem to be making investors anxious.

Over the weekend, several social media accounts related to cryptocurrency were blocked on China’s social media giant Weibo, just as the Beijing government widens its crypto crackdown by banning banks and payment companies from providing services for crypto transactions. The rules which allow any sort of crypto mining in Northern China are ever more tightened.

Former US President Donald Trump also had an opinion, saying to Fox Business earlier this week that the world’s biggest cryptocurrency seems like a scam which could take the edge off of the dollar.

Lastly there is the mention of Bitcoin together with a recent spate of ransomware attacks. The US Justice Department announced that authorities recovered $2.3 million in Bitcoin paid to ransomware hackers who attacked the Colonial Pipeline .

Speaking in a research note, market analyst Jeffrey Halley pointed out that any fall below $30k could open the floodgates to capitulation. In essence, a fall below that would:

Basically put every long position since January 1st in the red, which I believe, will trigger another capitulation trade.

In essence, it’s possibly time to open up the umbrella and decide if you’re gonna HODL or have spaghetti hands then.

Some analysts are saying that the bottom is in, but time will tell if that’s true. Sicne, another negative news article can dump the Bitcoin price again.

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