Bitcoin’s ‘Ugly Start’ – Weekend Sell-Off Pushes Price Near $80K

Bitcoin took another blow on March 10, retreating below $82,000 and sending jitters across the crypto market. The latest loss in value for the world’s top digital asset comes after weeks of decent gains. Traders at the moment are unsure if this is just a temporary hiccup, or the start of a more significant correction.

Important Levels To Monitor

Arthur Hayes, the chief investment officer at Maelstrom and co-founder of BitMEX, anticipates that Bitcoin may encounter resistance at $78,000. He describes Bitcoin’s dismal showing as an “ugly start” to the week.

Hayes suggests that the next significant support zone could be approximately $75,000 if the price of Bitcoin fails to normalize above this level.

https://twitter.com/CryptoHayes/status/1898867933679616103?ref_src=twsrc%5Etfw” rel=”nofollow noopener” target=”_blank

Investors have voiced concerns about the drop, especially those who have just joined the market. The market analysis firm 10x Research described the dip as a “classic correction”. The company also disclosed that traders who bought the coin in the last 12 weeks were responsible for about 70% of the selling pressure. New investors’ panic selling may make volatility worse.

Status: Extreme Fear

Sentiment has changed rather dramatically. Reaching a reading of 20, the Bitcoin fear and Greed Index measures market mood and shows that it has dropped into “extreme fear.” This stands in sharp contrast to the past few weeks, when optimism was high. A low rating like this usually suggests that traders are jittery, which could cause more short-term price swings.

Data shows, meantime, that a good majority of Bitcoin options fall between $70,000 and $75,000. As Bitcoin approaches these levels, traders could change their positions, which would generate more volatility.

Upcoming Inflation Data May Impact Prices

The forthcoming US inflation report has the potential to significantly influence Bitcoin’s subsequent course of action. Investors are closely keeping tabs of the US Federal Reserve’s monetary policy, as any indication of tighter or loosened financial conditions could potentially impact the price route of Bitcoin.

A surge in inflation that exceeds expectations could potentially increase the likelihood of additional rate rises, which could exert pressure on risk assets and Bitcoin. Conversely, a decrease in inflation could potentially alleviate market volatility and promote stability.

The Road Ahead For The Crypto

At the time of writing, traders are intently monitoring $78,000. A successful sustain above this level could potentially bolster confidence, while a break below it could result in additional losses. Sharp movements such as these are becoming increasingly prevalent as Bitcoin continues to develop as an asset.

Featured image from Gemini Imagen, chart from TradingView