Bitcoin prices plunge below $40K after a ‘poor' breakout

The cryptocurrency community is once again gripped with dread after Bitcoin (BTC) plummeted below $40,000 for the second day in a row and America deals with the most significant Consumer Price Index (CPI) increase since 1981.

On June 14, 2018, the price of Bitcoin plummeted by more than $3,000 in a matter of minutes. According to data from Cointelegraph Markets Pro and TradingView, early in the morning on June 14, the price made an attempt to rise above $40,000 but was halted at $40,650 where it subsequently fell below $39,600.

BTC/USDT 1-day chart. Source: TradingView

Here’s a rundown of what several experts think about the present condition of Bitcoin and what could happen next as financial markets struggle with an increasing amount of uncertainty.

Bitcoin is only retesting a significant S/R level –

According to crypto analyst and pseudonymous Twitter user “Credible Crypto,” who posted the following chart depicting the numerous retests of this level going back to 2020, the current price action for Bitcoin is largely considered a retest of a significant support and resistance (S/R) zone.

BTC/USD 1-week chart. Source: Twitter

The middle green circle and the last red circle, according to Credible Crypto, provide past examples of intra-week movements that went above or below the weekly level, but it means nothing unless there is a following close to confirm it. “Give me a close below BLUE and I’ll change my tune,” says Credible Crypto.

Analysts predict a slow economic recovery –

The most recent weekly report from Glassnode, which discusses insights into Bitcoin investor behavior, explains that there has been “a modest amount of profit-taking by investors” following the BTC breakout-out from a multi-month consolidation range. According to Glassnode, “the market has seen about 13,300 BTC in profits realized each day since mid-February. “While this value is not historically large, it does appear to be providing sufficient headwinds to prices,” the firm adds.

Bitcoin realized profit. Source: Glassnode

Overall, the recent rebound in Bitcoin has been relatively sluggish, with the market waiting for a major stimulus to rejuvenate investor interest and drive fresh influxes into the cryptocurrency sector.

Glassnode said, “Especially across on-chain activity metrics like transaction counts and active users, the recovery has thus far been relatively lackluster and continues to suggest Bitcoin is a HODLer dominated market, with few new investors flowing in.”

A “MEGA PUMP” is on its way –

A strongly bullish story was highlighted by crypto trader BTCfuel, who posted the following chart showing the probability of a “mega pump” from Bitcoin.

BTC/USDT 1-day chart. Source: Twitter

BTCfuel said, “When looking at the RSI, the 2022 Bitcoin correction is very similar to 2021. Strong BULLISH move imminent.”

The overall cryptocurrency market cap has increased to $1.850 trillion, with Bitcoin’s dominance rate standing at 40.9%.

The Crypto Tax Calculator Australia website is a fantastic software application for anyone in Australia that has made cryptocurrency transactions and needs to calculate their taxes owed on those transactions. This application makes it easy to calculate your taxes in a simple and easy way. If you are an Australian trading with cryptocurrency or an accountant with clients that trade with cryptocurrencies, be sure to check out our website and see how it can help save time and hassle when calculating crypto taxes.