The Bitcoin price has dropped down to $3,600 with the mark of Bitcoin’s biggest daily drop in the previous seven years. Furthermore, around $1 billion worth was liquidated on March 12, as one of the most intense squeezes in the crypto market’s recent history.
The main catalyst of a 50% decline in the price of Bitcoin within eight hours was the 9.99% drop of Dow Jones Industrial Average. The United States stock market witnessed the worst sell-off since 1987, as panic over the coronavirus intensified to unprecedented levels.
In the past seven days, cryptocurrencies and Bitcoin, in general, have accounted for a high level of correlation with the U.S. stock market. This has resulted in the overall drop in investor appetite for high-risk assets. The corrections in the U.S. stock market together with a lack of buying demand as Bitcoin’s price fell to the reduction of $5,000 levels ultimately led the price to decline to $3,600.
The global financial market initiated to show signs of recovery. The introduction of more stimulus packages from central banks in the U.S. and Europe, Bitcoin is likely to remain vulnerable to abrupt pullbacks in a short period.
Cryptocurrency trader and technical analyst Eric Thies stated that the focus of investors has only been on the coronavirus and there have been more significant geopolitical conflicts and risks affecting the market such as the dispute on oil prices between Russia and Saudi Arabia. The estimated decline in the price of oil pressure on global markets.
Furthermore, Thies dropped a statement that today massive dumps in the crypto markets and the traditional markets were extremely interesting. Whereas, most would only believe only due to coronavirus and will see that show some usual signs of a recession.
However, Thies addressed that with the fall down to $3,600, a new market cycle for Bitcoin is estimated to initiate Top Traders which have stated in the last 24 hours that plunge of Bitcoin could start a long accumulation phase, similar to in early 2019.