Yesterday evening at 7 p.m. Eastern time, Bitcoin (BTC) hit a new 2019 high of $9,435, and simultaneously the total crypto market cap hit a new 2019 high of $292 billion. However, Bitcoin (BTC) reversed course after that, declining as low as $8,960 around 1 p.m. Support near $9,000 held up despite the selling pressure, and currently, Bitcoin (BTC) is trading near $9,100.
Today’s Bitcoin (BTC) bearishness may be the result of a couple of factors. First, the stock market is rallying, with the Dow Jones Industrial Average (DJIA) gaining 400 points. An inverse correlation has been noted between stocks and Bitcoin (BTC), where if stocks go down Bitcoin (BTC) goes up and vice versa. This is due to investors who typically buy stocks diversifying into Bitcoin (BTC) when stocks are performing poorly, and when stocks are performing well, such investors may sell off their Bitcoin (BTC) to buy stocks.
The second factor is the indefinite suspension of the Hong Kong extradition bill. The Hong Kong extradition bill, if passed, would have allowed authorities to deport Hong Kong citizens to China to face trial. This panicked wealthy businessmen, causing an outflow of capital from Hong Kong. It is likely that Bitcoin (BTC) was purchased en masse in order to funnel money out of Hong Kong. However, now that this bill is not on the table for the foreseeable future, the panic has subsided, and this has probably decreased Bitcoin (BTC) demand.
Aside from the support level at $9,000, a critical support level to watch is $8,800. If Bitcoin (BTC) goes below $8,800, it might experience a significant crash, but if it holds above $8,800, Bitcoin (BTC) will probably have a decent chance of retesting the 2019 high near $9,400. The resistance levels to watch are $9,400 and $10,000.
The cryptocurrency market is mixed today and generally in the red. Ethereum (ETH) is down 2.7%, Ripple (XRP) is down 1.2%, Bitcoin Cash (BCH) is down 4.8%, EOS is down 4.5%, Stellar (XLM) is down 3.5%, Cardano (ADA) is down 3.1%, Tron (TRX) is down 2%, Monero (XMR) is down 1.9%, Cosmos (ATOM) is down 5.8%, IOTA (MIOTA) is down 1.4%, NEO is down 4.2%, Ethereum Classic (ETC) is down 3.8%, Tezos (XTZ) is down 5%, and Dogecoin (DOGE) is down 1.6%.
A handful of major cryptocurrencies are in the green today. Zcash (ZEC) is actually rallying with a gain of 9.7% in the past 24 hours. Litecoin (LTC) is up 0.5%, Binance Coin (BNB) is up 1.7%, Bitcoin SV (BSV) is up 0.4%, and Dash (DASH) is up 0.2%.
The bears have outpaced the bulls today, causing the total crypto market cap to decline $10 billion from $292 billion to $282 billion. The current total crypto market cap is 182% above the bear market low of $100 billion in December.