Bitcoin hit a fresh 18-month low of $175,000 on Sunday before quickly recovering above $20,000 in the ensuing hours, providing some respite from a stressed bear market.
Bitcoin has rallied more than 15% in the past 24 hours, rising from a disappointing new low to $20,482 at the time of writing, according to CoinMarketCap.
Bitcoin is currently pushing 2017’s all-time high range of $17,000 to $20,000, and the constant pursuit of lower prices suggests that sellers are under pressure.
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Bitcoin fell to $17,677.42 on Saturday before recovering to $18,290.74. The most sought-after crypto asset extended its recovery after Tesla CEO Elon Musk tweeted that he is now buying the joke coin Dogecoin.
The price of the popular cryptocurrency rose 8 percent to $0.058 on Monday after tweeting that he would “continue to support Dogecoin.”
I will continue to support Dogecoin
— Elon Musk (@elonmusk) June 19, 2022
In response to Musk’s tweet, one user suggested that if he really believed in the “joke” coin, he should buy it. The billionaire replied, “I am,” implying that he was buying the drop.
By falling below $20,000, BTC sparked a market trend that analysts say could spark a wave of forced selling. In this case, large investors in both cryptocurrencies would be forced to unwind BTC and ETH derivatives.
Bitcoin and ether account for a little more than half of the cryptocurrency market capitalization and are often volatile. In the previous hour, the entire cryptocurrency market rose 3.7% to $972 billion.
BTC total market cap at $381 billion on the daily chart | Source: TradingView.com
Bitcoin fell 30% in the last week, while ethereum fell 31%. Bitcoin is down 72% from an all-time high of $69,044.77 set on Nov. 10, while ethereum is down 78% from an all-time high of $4.878.26 set on the same day.
Andrew Brenner, head of international fixed income at National Alliance Securities, said Monday that retail investors buying bitcoin over the weekend, when few professional traders were active, may have caused bitcoin to regain some spark.
Bitcoin has temporarily halted the sell-off, which could push the world’s top cryptocurrency to levels above $20,000 in the current bear market, pushing it as low as $13,800, according to some market analysts.
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Featured image from TDK Corporation, chart from TradingView.com