Bitcoin Price Recovers To $22,500 - Is This The Big Comeback?

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This past week was tumultuous for the frontrunner cryptocurrency- Bitcoin. It was battling against the worst volatility tide in the crypto market and dropped below the $19,700 mark over the weekend. However, earlier today it went through a sharp rise and is now recovering at the $22,500 mark.

Let’s dive into the technical details to understand more about Bitcoin’s fluctuations and know which direction the coin is heading from here.

Bitcoin’s Price Performance in the last 7 days

Bitcoin took a major blow on Friday last week, which lasted well through the weekend. Its price started at around $22,500 but dropped to the $21,600 mark soon. Despite the volatility in the cryptocurrency market at that time, BTC was successfully avoiding the fall. It had developed some strong support at the $22,000 level, but could not keep its balance for long.

On Friday, it took a sharp fall all the way to the $20,100 level. The coin tried to rise above that but only could make it to the $20,300 level, before again diving down to $19,600. This is the lowest Bitcoin has gone in the last 30 days.

Bitcoin’s price fluctuated throughout the weekend. It reached a 7-day high of $20,700 and a 7-day low of $19,900. However, it started to gain some upward momentum in the late hours of Sunday and has managed to recover to the $22,500 level this morning.

Bitcoin price has surged around 14.2% from its recent low of $19,600. Its price at the time of writing this article was around $22,490. In the last 24 hours, the coin has shown around 9.5% growth in its price.

Silvergate Caused Havoc In The Cryptocurrency Market

The recent havoc in the cryptocurrency sector was caused by Silvergate Capital Corp. Silvergate is one of the few regulated institutions which offer banking services to cryptocurrency exchanges and companies. FTX was one of the leading clients of Silvergate and thus the collapse of FTX put Silvergate on extremely shaky grounds.

The crypto-friendly financial institution was severely hit by the outgoings of FTX and had a loss of over $1 billion. At the start of this week, Silvergate was on the brink of bankruptcy. Its parent company announced their intention of stopping all operations and plans of liquidation.

The fall of Silvergate further proves the argument of the US regulatory body. The traditional financial institutions that provide banking services to cryptocurrency are not properly equipped to handle the volatility and high demands of the cryptocurrency market. This further proves that cryptocurrency will continue to threaten traditional banking institutions and the financial system.

Banking regulators in the US have been already giving out a warning concerning this since the late 2022 massacre. They have been blowing their trumpet regarding the high risks involved for financial institutes in serving crypto exchange and crypto companies.

However, cryptocurrency industry experts do not conform to this viewpoint. They believe that the Silvergate crash was a normal banking risk rather than a crypto risk. This crash was caused by its inability to deal with the customers’ heavy withdrawal requests due to a lack of adequate cash.

Nevertheless, the whole episode acted as a catalyst for the wild fluctuations of the crypto market, and Bitcoin was affected the most.

US Regulators Promise Caused Bitcoin To Rebound.

Bitcoin’s price fluctuations were a direct result of the current activities going on in the US economy. The news regarding Silicon Valley Bank plunged the entire cryptocurrency market into further depth. The failure of SVB is considered the second worst banking disaster after the financial crisis of 2008.

US banking regulators decided to take some emergency measures to save the economy. The government provided some much-needed relief to investors and said that they will protect the customers’ deposits at this crypto-linked bank. US regulators also promised additional backstops in the banking sector to safeguard customers’ funds.

This act of assurance put some faith back into the cryptocurrency industry. This caused the prices of some non-stablecoin such as Bitcoin and Ether to soar over the weekend.

Bitcoin’s Current Market Standing

Bitcoin was able to recover well from its last week fall. It is now trading at around $22,490. In the last 24 hours, it has seen a surge of almost 9.5%. Bitcoin’s current market capitalization stands at almost $430 billion. Its total circulating supply has reached $19.3 million. In the last 24 hours, Bitcoin had an opening price of $20,549 and currently has already surged by around $2000. Its 24h trading volume has reached almost $898 million.

Bitcoin’s current rally above the $22,000 mark shows that the bearish movement of 10th March has been weakened as Bitcoin bulls bought the coin when it dipped. It has been able to break out from the previous resistance level of $22,200. The market is now inching towards being overbought and thus Bitcoin’s upward momentum has been impeded.

Bitcoin has high volatility at the moment. Volatility is a statistical tool which determines the risk associated with certain crypto assets. Bitcoin’s current volatility is around 5.5% which is considered very high. This means that it is a highly risky option for investment right now. In addition to this, the current market sentiment for Bitcoin is neutral.

In the contrast, Bitcoin’s 14-day RSI score is at around 66 and is indicating BUY. This means that the asset is not overbought yet and thus has less chance of a pullback. This indicates that Bitcoin’s price may see a little more hike in the coming days.

Bitcoin has now returned to its previous trading level of around $22,500. Its current 200-day SMA is at around $22,190 which is lower than its current price. This indicates a bullish movement in its future. If the price cuts through the resistance at $23,000, its price may surge up to the $25,000 level. However, if the price is not maintained above its moving average, then Bitcoin may experience some crash down to the $20,500 level.

Conclusion

Big storms have been brewing in the US economy and its banking sector. As the situation progresses, the cryptocurrency market stands to get heavily influenced. The volatility of the crypto market can never be denied and as a result, the major cryptocurrencies stand on shaky grounds. At times like this, it is best not to engage in impulsive investment. It is always wise to do extensive market research and price study, before taking any major decision.

Investors who want to look beyond Bitcoin may consider some other popular alternatives such as CCHG, METRO, FGHT etc. These new currencies are creating a positive ripple in the crypto market with their successful ongoing presale and aims to revolutionize this industry.