Bitcoin dropped 3.62% to $102,666 after Moody’s downgraded the US credit rating. Bearish signals point to a test of $100K, with support at $95K to $91K.
With Moody’s downgrade of the US credit rating from AAA to AA1, there has been a major pullback in both the US and crypto markets.
The agency cited the ballooning $36 trillion national debt and rising interest costs as key drivers behind the cut, its first since assigning the U.S. a top-tier “Aaa” rating in 1919.
Today, Bitcoin is down 3.62%, trading at $102,666. Will this intraday pullback lead to a breakdown of the $100,000 milestone?
Bitcoin Price Analysis
Bitcoin’s daily chart highlights a strong price reversal from the 50% Fibonacci level near the $75,500 supply zone, resulting in a near 40% rise, with the recent 24-hour high at $107,115.
However, the intraday pullback undermined Sunday’s 3% gain, forming a bearish engulfing candle.
Increased supply pressure due to broader market fears, uncertainty, and doubt has caused short-term panic. The bearish engulfing candle forms near the strong overhead supply zone around the $106,000 mark, threatening a potential bearish trend reversal.
Supporting the downside risk, the MACD and signal lines have given a bearish crossover. According to the price action, the immediate support lies at $98,349 if the $100,000 psychological support level fails.
However, the Fibonacci levels indicate stronger support at $91,780, at the 78.60% level. This suggests a downside risk of nearly 10%. Additionally, a crucial support level exists at $95,269, marked by the 50-day exponential moving average. The dynamic average support is known for providing strong support, helping maintain the uptrend.
Conversely, a potential reversal in the short-term price trend could push Bitcoin to a new all-time high, surpassing the $109,356 level. The Fibonacci levels suggest an upside potential to reach $127,800 at the 1.272 level.
Liquidations Spike as Bitcoin Futures Open Interest Drops After Crossing $70 Billion
Following the intraday pullback, the derivatives market saw a sharp shift in trading activity. Earlier today, Bitcoin open interest reached a new all-time high of $70.03 billion before pulling back to $67.54 billion. This suggests a significant decline in bullish sentiment due to the intraday pullback.
Over the past 24 hours, short liquidations in Bitcoin rose to $93.81 million, while long liquidations totaled $81.97 million. The intraday pullback led to a sharp drop in bullish sentiment in the derivatives market.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
