The Bitcoin price dropped from $6,750 to $6,250 in just a few minutes. The largest cryptocurrency by market cap saw its price declining by 5%. The sudden drop in the bitcoin price surprises the cryptocurrency market, as Bitcoin has relatively well defended the $6,500 support level over the last two weeks and the signs of a future bear market are gradually declining.
What caused the sudden price decline?
Last week, Bitcoin showed a low daily trading volume on most major crypto exchanges. Daily trading volume has fallen to $3.2 billion, the lowest level of the year.
The decline in volume prompted traders to express concerns about short-term price movements. As a result, many investors held back as most people are not sure which direction the market will break. This circumstance favored sellers and bears as there was virtually “little” trading activity in the cryptocurrency market.
Traders expect a downturn
In general, traders are expecting a big downturn in the crypto currency market before the price will start a large medium-term rally. Historically, after months of stability in a low price range, Bitcoin has tended to rise 10 to 30 times
The lack of volume, the lack of trading activity on the market and the inability of the Bitcoin to break the $ 6,800 resistance level after several attempts have contributed to a sharp decline in value.
Crucially, Bitcoin’s stability has been in the $6,000- $6,700 range for more than two months since 9 August. If Bitcoin successfully defends the support level of $6,000 and can stay above the $6,300 mark for the next 12 to 24 hours, Bitcoin (BTC) is unlikely to experience another sharp decline.
The price of Ripple (XRP) has been falling over the last three weeks, despite the increased mainstream adoption of the coin.