Bitcoin smackdown hits $20,125 low as FUD gets cranked up to ten

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(Kitco News) – Crypto prices were hammered in trading on Thursday as the announcement that Silvergate Bank would wind up operations and the threat of higher interest rates pushed many traders to head for the exits and the safety of stablecoins until the latest turmoil blows over.

Shares similarly faced downward pressure in the afternoon after climbing higher in the morning session on weak initial claims data as investors opted to take a more cautious approach to the market ahead of Friday’s key February jobs report. At the close of trading, the S&P, Dow and Nasdaq all ended the day lower, down 1.85%, 1.66% and 2.05% respectively.

Data provided by TradingView shows that Bitcoin (BTC) bears held nothing back in their attack on bulls, hammering the top crypto below $21,000 support and looking determined to break the $20,000 support.

BTC/USD 4-hour chart. Source: TradingView

Before the afternoon sell-off, Kitco senior technical analyst Jim Wyckoff noted the possibility of such an outcome, saying “Bears have gained a small near-term technical advantage amid another price decline in place on the daily bar chart.” Wyckoff added that “Bears still have some momentum to suggest more sideways-lower trading in the near term.”

Eight global CEO Michaël van de Poppe – who noted that “The amount of negative news in recent hours is at a record high” – highlighted the $20,400 area as a potential place to open a long position before the afternoon move.

This scenario plays out for #Bitcoin.

Taking the low, tons of liquidity below that level is taken, hence the acceleration on specific #Bitcoin and #Ethereum.

Might as well take the $20.4K low and we’ll be there, as bears will be euphoric.

RSI full reset. pic.twitter.com/MLyuWyPJ8r

— Michaël van de Poppe (@CryptoMichNL) March 9, 2023

After the withdrawal, Poppe observed that “Nearly a month ago people wanted to get into Bitcoin, and rushed over each other,” but are now running for the exits as the price has fallen 20% since then. According to Poppe, this is “the time you should start collecting, and not when things have gone massively. Against your feelings.”

And a call for calm was issued by market analyst Rekt Capital, who reposted the following tweet from last Friday, which highlighted the possibility of a correction below $20,000. While such a move would still leave BTC in the macro range it has been trading in for some time, Rekt Capital warned that BTC still faces a possible macro downtrend in the coming weeks.

#BTC rejects from the converging resistance that is the Range High and the Macro Downtrend$BTC now falling into the Range Low as part of the consolidation

BTC may still face the Macro Downtrend in the coming weeks, provided this Range continues to hold#Crypto #Bitcoin pic.twitter.com/xEzyc7WWWF

— Rekt Capital (@rektcapital) March 9, 2023

Altcoins are being demolished

The altcoin market was wiped out as the Bitcoin price plunged, with a large number of tokens in the top 200 experiencing double-digit losses of over 15%.

Daily performance in the cryptocurrency market. Source: Coin360

The hardest hit tokens include Huobi Token (HT), which fell 28.88%, a 20% decline for FLOKI (FLOKI), and a 15.77% pullback for Onyxcoin (ONX).

The total cryptocurrency market cap is now $940 billion, and Bitcoin’s dominance rate is 41.7%.