With Bitcoin losing 4% in the last 24 hours, traders are beginning to express fears that the cryptocurrency will shred more of its value in the coming days.
Crypto analytics company IntoTheBlock, in its latest update today, noted that the world’s largest cryptocurrency by market capitalization is approaching a key level of support that will determine its price in the coming days.
According to IntoTheBlock, is approaching support between $40,800 and $42,000, the price level that saw over 787,000 addresses accumulate a whopping 272,000 units of BTC.
It is expected that traders who bought the asset class within the support range will most likely hold on to the cryptocurrency, thus keeping the price away from falling any further.
However, should traders fail to hold the level of support, IntoTheBlock forecast that the price of Bitcoin will dip below $38,000?
“Using IntoTheBlock’s IOMAP indicator, we can identify that some support can be expected between $40.8k and $42k, where 272k BTC was acquired by 787k addresses. If this level fails to hold, Bitcoin could revisit the $38k lows,” IntoTheBlock tweeted.
$BTC is approaching a key level of support.
Using IntoTheBlock’s IOMAP indicator, we can identify that some support can be expected between $40.8k and $42k, where 272k BTC was acquired by 787k addresses. If this level fails to hold, Bitcoin could revisit the $38k lows. pic.twitter.com/zMFCNEcuWB
— IntoTheBlock (@intotheblock) February 17, 2022
Fed’s Upcoming Interest Rate Hike Affects BTC
The latest Bitcoin dip came as the market is eagerly expecting cues from the Federal Open Market Committee (FOMC) about a potential interest rate increase in March.
Recall that in January, BTC slumped 4.5% after the first meeting of the FOMC indicated that the committee would hike interest rates in a bid to reduce inflation and unemployment rates.
With the crypto market expecting cues from the feds as March edges closer, several traders are converting to stablecoin as they fear a repeat of last month’s dump.
According to LookIntoBitcoin, the Bitcoin Fear and Greed index currently sits at 52/100, indicating that traders are neutral about the asset’s price.
Disclaimer: 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’s opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
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