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Bitcoin (BTC) Price: Back to Lowest Levels Since June and Testing $8,000

After crashing earlier this week and losing over 15% of its value, Bitcoin has now leveled out and has been trading sideways for the past 48 hours. It appears to have found a comfortable position just above $8,000, a level that provided strong support for almost month back in late May and early June this year.
Earlier today, Bitcoin experienced another sharp drop, falling quickly from $8,370.91 down to its lowest level since June, $8,128.20. It has since enacted a decent recovery back above $8,250 – but many wonder how long the $8k support level can hold?

Divided Opinions

The crypto community appears to be somewhat divided on where Bitcoin will go from here. Fundstrat’s Thomas Lee believes traditional stock markets are key to catapulting Bitcoin back into a bull market. In a tweet yesterday, he pointed out Bitcoin’s fall could be related to a selloff in equities and won’t recover until the faltering S&P 500 does too.
Popular crypto trader and Twitter voice DonAlt envisions further losses if Bitcoin doesn’t reclaim the lower part of the range it was previously trading in. In agreement with several other commentators on the matter, he sees the next potential support zone to be between $7,350 and $7,700. This is the range that Bitcoin traded in during most of early May before breaking out above $8,000.

Reasons for the drop

The most popular opinion regarding why Bitcoin suddenly experienced this flash crash is the weak launch of Bakkt. Many believed that the launch of the Bakkt’s Bitcoin Futures product would flood the market with institutional money but the first day of launch saw barely any investment at all. Following on this failure to draw investment, Bitcoin immediately broke out downwards from its descending triangle pattern and had no prior support levels to prop it up.
Other people noted the sudden drop in the hash rate that occurred in sequence with the Bitcoin price crash, falling suddenly from 92 million TH/s to 57 million TH/s. The price of Bitcoin isn’t necessarily tied to the network hash rate so its uncertain whether this contributed to the fall, was a result of the fall, or was purely coincidental. The hash rate has since recovered to normal levels but reasons for the sudden fall remain unclear. Theories range from an update to ASIC S9 mining hardware to a simple miss-estimate caused by several slow blocks being completed at once.

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