Bitcoin Follows Through With Intense Sell-Off

Bitcoin was met with yet another wave of heavy selling pressure at the $12,000 psychological line yesterday, which caused the cryptocurrency to shed more than $900 on its way back down to the $11,165 level.

This will be the third consecutive time in 31 days that Bitcoin has failed to clear the $12,100 level.

In yesterday’s analysis, we pointed out that Bitcoin was entering overbought conditions on the 4-hour MACD indicator and that it could trigger a sell-off in the near-term. This was most likely the cause of yesterday’s reversal.

Reports from a cryptocurrency data collecting company show that more than $58 million worth of long positions on BitMEX was liquidated after the sell-off happened. This most probably aided the decline.

Meanwhile, a total of $25 billion has been removed from the cryptocurrency market in the last 24 hours, as traders were swept with panic.

Key BTC Levels to Watch

BTC has clawed its way back above the $11,350 support area where it currently is. The first level to take now is the $11,550 (50-day SMA) followed by the vital resistance at $11,650. The $11,650 level is supported by the 100-day SMA further invigorating that area.

On the flip side, if the current panic in the market continues, we could see the benchmark cryptocurrency slide to the $11,100 support right before we see the $11,000 psychological level. Further declines from this level will open Bitcoin up to a $10,800 price tag and subsequently the $10,500.

That said, what seems appropriate at this point is to wait to see price make a significant move (upwards or downwards) before making any aggressive bets.

Total market capital: $374 billion

Bitcoin market capital: $210 billion

Bitcoin dominance: 56%

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