[ad_1]
(Bloomberg) – Follow us @crypto for our full coverage.
Another bad week for Bitcoin could be the forerunner of more pain to come, according to strategists watching the cryptocurrency sell off.
Further weakness in its price could make the $ 20,000 area a lower target, according to Oanda Corp., Evercore ISI and Tallbacken Capital Advisors LLC. Bitcoin fell around 7% this week and was trading at around $ 34,200 at 10:16 a.m. in London.
Largest cryptocurrency is approaching dangerously close to the $ 30,000 level amid growing regulatory fears in the United States, and a $ 30,000 breakout could lead to huge selling momentum, said Edward Moya, analyst at main market at Oanda Corp.
Bitcoin has lost around $ 30,000 from its April record, troubled by billionaire Elon Musk’s criticism of the energy it needs as well as further regulatory crackdown in China. The ability of U.S. authorities to recover a high-profile Bitcoin ransom also rocked the notion that it was outside of government control, which has been an article of faith for some of the coin’s supporters.
Evercore technical strategist Rich Ross and Tallbacken capital advisers Michael Purves both flagged the $ 20,000 area as a potential key level if Bitcoin breaks much lower than it currently is.
Others, however, remain confident about the longer-term outlook.
For example, Michael Saylors MicroStrategy Inc. increased a $ 400 million junk-bond sale to $ 500 million to fund the purchase of more Bitcoin. MicroStrategy has become one of the most bullish public companies on cryptocurrencies. In El Salvador, President Nayib Bukele said the nation has adopted Bitcoin as legal tender.
Still, about a week after Bitcoin’s historic high in mid-April, Tallbackens Purves had argued that the bullish case looked hotly contested.
How far can he go? Purves asked in his note Tuesday. The most obvious answer continues to be a full retracement of the $ 20,000 breakout – in other words, back to $ 20,000.
The story continues
Meanwhile, debate intensifies over the importance of cryptocurrency policing. Securities and Exchange Commission commissioner Hester Peirce said she was concerned about a push for a more active role by regulators in the crypto market, according to a Financial Times interview.
(Market updates in second paragraph.)
More stories like this are available at bloomberg.com
Subscribe now to stay ahead of the game with the most trusted source of business information.
2021 Bloomberg LP
[ad_2]
picture credit