Bitcoin Slumps to Lowest Monthly Level, ‘Could Get Ugly’ If $38,000 Point Breached

Bitcoin Slumps to Lowest Monthly Level, ‘Could Get Ugly’ If $38,000 Point Breached
FILE - Representations of virtual currency Bitcoin are seen in this picture illustration taken taken March 13, 2020. REUTERS/Dado Ruvic/Illustration/
Naveen Athrappully
Updated:

Bitcoin has fallen to its lowest level in about a month, with prices dropping to $38,580 on April 18 as investors remain risk-averse to the digital currency and uncertainties mount over demand for these coins.

After exceeding $68,500 in November 2021, Bitcoin prices fell below $33,500 in January 2022. Since Russia invaded Ukraine, the cryptocurrency has been trading in the $37,500 to $48,000 range. Bitcoin was priced at $39,196 as of 15:49 UTC (11:49 a.m. Eastern time) on April 18, a 42 percent decline from the November peak.

However, Bitcoin is “not close to an oversold reading,” John Roque, technical analyst at 22V Research, said in a note Sunday, according to Bloomberg. He is not expecting the near-term support of $35,000 to hold and believes that Bitcoin will get to the $30,000 level, which as per the current price would require a drop of over 23 percent.
“Bitcoin is in the danger zone as risky assets are tumbling as the bond market selloff resumes,” Edward Moya, a senior market analyst at OANDA, wrote in a note for India’s Economic Times newspaper. “If it breaks below $38,000, it could get ugly real fast.”

Trading volumes for Bitcoin have seen a drop in recent months. The aggregate 30-day moving-average volume at crypto exchanges like Kraken, Bitfinex, and Bitstamp is at its lowest level since August 2021 according to data compiled by FRNT Financial.

Aggregate daily volume at these exchanges averaged just over $1 billion in the last month, which is a 60 percent decline from the $2.57 billion volume in May last year.

“We’re not getting follow-through from new investors. Despite the relentless advertising, most of those who were inclined to buy Bitcoin have already done so,” Steve Sosnick, chief strategist at Interactive Brokers LLC, said to Bloomberg Quint. Ultimately, Bitcoin is a risk asset and will behave the way that risk assets do, he added.

Bitcoin trading volumes are down because of “uncertainty,” said Noelle Acheson, head of market insights at Genesis Global Trading, while adding that investors seem to be worried about things getting worse “before they get better.”

Despite the decline in price and market uncertainty, crypto experts in the United States are expecting a spot Bitcoin exchange-traded fund (ETF) to be launched this year. Such optimism has strengthened after the Securities and Exchange Commission approved the application for the Teucrium Bitcoin Futures ETF in early April.

“Bitcoin is now an institutional market. It’s a market with institutional service providers, institutional investors, a large and robust regulated futures market,” Bitwise Asset Management’s Matt Hougan said in an interview with CNBC.
Meanwhile, multiple states in the United States are considering allowing cryptocurrencies like Bitcoin to be used as legal tender, with California and Arizona pushing forward such plans.
Naveen Athrappully
Naveen Athrappully
Author
Naveen Athrappully is a news reporter covering business and world events at The Epoch Times.
Related Topics