Bitcoin is currently undergoing massive pull back after recording gains around the $8,400 level last week. This is after the news that the SEC rejected the ETF application by the Winklevoss twins. As of press time, Bitcoin is trading at the $7,300 level, total market capitalization is around $260 billion, and Bitcoin dominance is at 48.6%.
Looking at the chart, as predicted in the previous technical analysis, Bitcoin is currently undergoing correction after the huge rally to $8,400. The price action was rejected at the 0.618 Fibonacci level, which acted as strong resistance. The price broke below the 0.5 and 0.382 Fibonacci support levels, and broke below the middle Bollinger Band. The MACD indicates that current momentum is in favor of the sellers. The RSI pulled back from the overbought region and has broken the support trend line, which means that we could see further losses in the coming days if RSI does not shift back up.
If price action could bounce off the 0.382 Fibonacci level with volume confirmation, upward MACD, and upward RSI, a potential recovery to re-try the 0.5 Fibonacci level could come in to play in the next few days.
Bitcoin Dominance: Altcoins Suffer
When Bitcoin surges upward, altcoins depreciate. When Bitcoin dramatically plummets, altcoins still depreciate. So, when do altcoins rally? Apparently, the relationship between altcoins and Bitcoin is very unusual. Both a sudden surge upward and a drastic price drop negatively affect the price action of altcoins. Because of the mid-July rally and the current pullback, altcoins suffered severely in terms of price. Almost all of the top 50 altcoins suffered double-digit losses in the past 7 days, except for Binance Coin. Bitcoin dominance is currently at 48.5%, which is the highest record for this year.
Wall Street Crypto King Still Bullish on Bitcoin
Despite the price drop, Bart Smith, Susquehanna Head of Digital Asset and Susquehanna ETF Group Co-Head, also known as Wall Street’s Crypto King, is convinced that the current price action is actually good for Bitcoin. According to Smith, Bitcoin is showing signs of resilience despite the drop. After touching the $6,800 mark for three times already this year, Bitcoin is able to bounce back up and rally for a recovery. Wall Street is still bullish on Bitcoin with hopes of an approval on other ETF applications and more institutional investments coming in the near future.