Bitcoin (BTC) fell below the psychologically significant $ 51,000 mark in a 24-hour period leading up to press time late Thursday night, and an analyst thinks more pain is to come.
What happened: The top cryptocurrency by market cap hit an intraday low of $ 50,856.57. At the time of writing, BTC was down 0.51% at $ 52,019.04.
In a seven-day trailing period, BTC is down 9.57%. From its all-time high of $ 61,683.86 – reached 12 days ago – the cryptocurrency is down 15.77%.
Analysts expect the downward momentum to continue, warning that BTC could break through the USD 50,000 levels.
Judging by recent events, traders seem happy to be selling in the rallies rather than buying the dip. So don’t be surprised if we see renewed weakness in the markets later in the session, ”wrote Fawad Razaqzada, market analyst at ThinkMarkets, as reported by MarketWatch.
Razaqzada said there could be more bad news in store for BTC. “The crypto has correlated positively with risk assets over the past year and if that relationship remains strong, the digital currency could track risk assets lower.”
Why it matters: Razaqzada urged Bitcoin traders to exercise caution, as he says “risk readiness” is slowly diminishing, MarketWatch reported.
Tesla Inc. (NASDAQ: TSLA) announcement that it would accept BTC for payments also led to profit-taking, Shane Ai, head of research and development at crypto exchange Bybit, reported Business Insider.
Also see: How Tesla plans to tackle Bitcoin’s volatility in payments for its vehicles
Another factor that contributed to BTC’s decline is the expiration of $ 5 billion in options, according to Ai, on Friday.
Contract expiration and some investors pushing the price down to monetize bets against the cryptocurrency in the options market “have created spot selling pressure at the end of the quarter,” the analyst said.
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