This weekend, Bitcoin quotes were trading strictly under the 61.8% Fibonacci level, which is approximately $58,000. Recall that the grid of Fibonacci levels is based on the last drop of $15,000. That is, bitcoin quotes recovered by 61.8% after the fall. And the level of 61.8% is an important correction, along with 50.0% and 38.2%. If the price crosses it, the chances of continuing the upward movement increases. However, trading on Monday showed that our hypothesis regarding the continuing correction scenario is still correct. After several attempts to overcome the level of 61.8%, the quotes still went down and began a new round of downward movement. Currently, the quotes went down by only $2500, which is not so much. However, the longer-term target is located near the previous local low, which is about $47,000. Moreover, the target of $43,852 per coin looks quite real, since the second round of correction is usually deeper than the first. In general, the level of $58,000 continues to be critical for bitcoin. Above it, we will consider the option of resuming the upward trend.
Meanwhile, there are still no changes in the fundamental background. Traders are receiving more and more news indicating that the growth of bitcoin's popularity has begun to slow down. Not all people and investors in the world believe that bitcoin is the cryptocurrency of the future and are ready to invest their last money in it. Moreover, several altcoins have recently started to step on the heels of bitcoin. In terms of capitalization, bitcoin is far ahead, but the popularity of Ethereum is growing very quickly and, unlike bitcoin, it is just called a digital currency, which is used for settlement and payments, and not for investment and savings.
In an interview with Bloomberg, Binance cryptocurrency exchange head and co-founder Changpeng Zhao said that bitcoin is actually no more volatile than the shares of companies such as Apple or Tesla. He noted that strong movements occur not only in the cryptocurrency, but also in the stock market. According to Zhao, "profit hunters" are to blame for the excessive volatility of bitcoin, who do not analyze the market and its tools at all, but simply buy this or that asset on positive news. Thus, Zhao almost openly stated that it is the "herd instinct" that is the reason for the excessive volatility of not only bitcoin, but also any other instrument. We believe that with these words, Zhao tried to calm the markets and instill confidence in them that bitcoin is the same investment tool as the shares of leading tech companies. But the shares are backed by specific assets, and bitcoin is just a piece of useless code.
In technical terms, bitcoin rose to the 61.8% Fibonacci level and still bounced off it. So, the further growth of "digital gold" will not be happening for the time being, given the lack of a supporting fundamental background and the technical exit of quotes beyond the ascending channel. The chances of a corrective fall remain high, and the movement of recent days no longer looks like a market growth of bitcoin, but a desperate attempt by the bulls to maintain the upward trend.
