Bitcoin Price Falls Further While Buyers Remain Patient
The cryptocurrency market looked shaky again today as crypto traders saw another 24 hours of drawback.
The cryptocurrency market experienced another drawback today as confidence among traders and investors seemed like a distant memory.
At time of press, the value of the entire cryptocurrency market is $2.6 trillion with a drawn down of 1.62% in the last 24 hours. The market has made a slight recovery through the day after bottoming out at $2.09 trillion at 19:40 UTC last night (December 13th). Bitcoin dominance is at 41.4% which is a slight rise since Thursday localised low of 39.8%. The price of Bitcoin is currently $47,230 representing a loss of 1.61% over the last 24 hours and a loss of 8.30% and 26.6% for the last week and month respectively.
While a drawback of 1.61% is of no real concern to traders the fact that Bitcoin has recently lost support at $48k and $47k with a localised dip down to $45.7k is more worrying. Who is selling and why?
Different strokes for different folks
With conflicting narratives across the world, it is difficult to determine just what is happening in the market. On one hand we have seen recent large scale investment from the likes of Michael Saylor of Microstrategy whilst on the other hand there is news coming out of Russia that the Central Bank of Russia is banning mutual funds in the country from making investments into Bitcoin.
Meanwhile, the German Savings Banks Association have announced details regarding a pilot project aimed at providing and exchange and private wallets to their 50 million customers allowing each and everyone to purchase cryptocurrencies directly.
Clearly each country has its own approach.
There is cause for optimism on the immediate horizon however as recent data from crypto exchange Bitfinex show there is increasingly strong buying support for Bitcoin from $44,500 to $46,000.
FOMC report imminent
Many investors believe this is in response to anticipated findings resulting from the FOMC meeting scheduled for Wednesday 15th December. The FOMC or Federal Open Market Committee is a group of 12 members which decide on monetary policy for the US Federal Reserve and the results of tomorrows key meeting are eagerly awaited by the cryptocurrency community. If, like many people are expecting, the FOMC meeting announces continuing rates of inflation then many investors will continue to see Bitcoin as a solid hedge. The previous FOMC meeting at the beginning of November announced the largest rise in inflation in 40 years leading to a surge in the price of Bitcoin from $60,500 to $68,700. The data from Bitfinex appear to confirm confident traders looking to buy at the bottom of this pull back before making the most from a 10% surge in price.
Buy the dip?
As Omnicron continues to develop across all corners many financial markets look like they are on shaky ground and Bitcoin is no exception. Cryptocurrencies are seen by many as a speculative investment and although the market is more mature than it was 5 years ago there is still a large portion of investors who do not share the confidence of others.
For many, investing in crypto has always been a long term project with objectives set 5 and 10 years into the future. Once the underlying technology and the context in which it can help society is understood many more people will be drawn to making their first cryptocurrency investment. Until then the wise investor will be making the most of this short term dip.
Author: Mark Harridge
Mark Harridge first came across Bitcoin and began to use its peer-to-peer payment network in mid to late-2011. He quickly understood that this technology would change the world. Mark is passionate about crypto adoption, from a macro economic and institutional perspective, and the numerous factors that fuel the relentless march towards individual self sovereignty and the decentralised society of the future.