Bitcoin price extended the losses recorded over the weekend on Monday as a risk-off mode weighed on cryptocurrencies. The protests reported from China are largely behind the bearish market sentiment. This comes at a time when contagion risks in the broader crypto market has swayed investors’ confidence in the assets.
Earlier in the day, the leading crypto dropped to a one-week low at the psychologically crucial level of $16,000, having dropped by about 3%. Major altcoins exemplified a similar trend with the likes of Solana and Dogecoin recording even higher losses. Ethereum, the leading altcoin by means of market capitalization dropped by about 4% earlier in the day.
Fundamentals
The collapse of the FTX crypto exchange and its sister trading firm, Alameda Research, had Bitcoin price drop to a two-year low of $15,534.96 about three weeks ago. Amid the subsequent contagion fears, BlockFi Inc. Is the latest crypto firm to crumble. In a statement, it indicated that it will employ the Chapter 11 process as it seeks to recover “all obligations owed to BlockFi by its counterparts, including FTX and associated corporate entities”.
Additionally, unrest in China contributed to the risk-off mood and the subsequent decline in Bitcoin price. With protests over COVID-19 restrictions in the second-largest economy, the crypto fear & greed index was at a fear level of 28. Granted, it is a slight improvement from the previous session’s fear level of 26.
Bitcoin price prediction
As shown on its four-hour chart, BTC/USD was trading below the 25 and 50-day EMAs. In the short term, the range between 16,692.91 and 16,212.76 will be worth watching.
If the bulls are unable to defend the support at 16,000, the next level to watch will be at 15,837.64. However, this bearish thesis will be invalidated by a move past the crucial resistance zone of 17,000.
