Owing to the lack of positive sentiment, financial analysts had predicted an imminent fall in Bitcoin to below $9,000 level in the last. As of Friday, the forecast has been realized with BTC slipping over 4.4% and breaking below the $9,000 support. The largest cryptocurrency by market cap printed a daily low of around $8,700 and is currently settling at around $8,800.
Other factors highlighted by the crypto experts that may have contributed to the drop in BTC price include the recent announcement by the Federal Reserve at the end of October that the monetary policy is now likely to be paused for a while. With no further leniency in monetary policy, cryptocurrencies especially Bitcoin is expected to lose its demand as an inflation hedge.
Bitcoin Is Currently Settling Around $8,800 Level
Trading at $8,800, Bitcoin has still printed a gain of over 100% in 2019, earning a reputation as the best performing financial asset of the year. Bitcoin had previously settled around $8,000 in the month of October. It surged higher at the end of the last month and posted a new high of around $10,500, following Chinese President Xi Jinping’s statement that suggested adopting blockchain for long-term economic stability and prosperity of the country.
In a short period of a couple of weeks, China has already announced multiple blockchain projects for various industries. The China-driven optimism managed to keep BTC upbeat in the past week that remained range-bound between $9,100 and $9,600. Analysts had expected the surge to continue with the price breaking above the yearly high of around $13,500. As of Friday, however, BTC buyers have lost steam that opened the door for a downward rally to around $8,500 level.
Bitcoin Drops Below The 200-Day Moving Average Located At $9,186
According to the Bitcoin specialists, the 200-day moving average registered strong support for BTC at $9,186. The drop was further accelerated on Friday after the price fell below the 200-day moving average. Delphi Digital’s co-founder, Kevin Kelly, also commented on Friday that the abrupt decline in Bitcoin’s price can be expected to have hit quite a few margin calls that is likely to keep the cryptocurrency under pressure in the long run.
On the upside, however, the third Bitcoin halving is set for May 2020. Historically, BTC has printed a pattern of massive gains about six months before halving. If the trend continues this year, investors can expect relatively stronger upward rallies by the end of November. Such forecasts direct caution for the BTC traders in the upcoming weeks.