- Bitcoin’s price drops below $ 40,000, losing roughly 40% from its all-time high at $ 64,895.
- This nosedive has pushed BTC below the 200-day SMA at $ 39,818, being a bearish sign from a technical perspective.
- Ethereum’s price followed the flagship cryptocurrency, dropping below $ 3,000 after a 35% drop from its all-time high of $ 4,380.
The price of Bitcoin has experienced massive selling pressure during the Asian session on Wednesday that has caused significant support levels to break. Ethereum’s price has also fallen below a crucial psychological level that indicates a change in trend.
Bitcoin’s bullish gains are in jeopardy
The price of Bitcoin has plummeted approximately 11% towards $ 38,514. This move has caused the flagship cryptocurrency to test the demand zone, which runs from $ 37,412 to $ 39,727. Furthermore, the 200-day simple moving average at $ 39,820 has also been broken, a bearish sign as it represents a major change in trend. Therefore, investors should keep a close eye on the daily close relative to the 200-day SMA.
While the above scenario looks bearish, during its bullish move in February, BTC gained traction around the aforementioned support area and led the rise from nearly $ 40,000 to $ 60,000.
Therefore, a drop in this barrier will allow more buyers to get the pioneer cryptocurrency at a discount. Investors can expect a quick bullish reaction that will push the price of Bitcoin 15% to target the low created on May 13 at $ 45,700.
If buyers overcome the downward pressure, BTC could rise another 12% to target $ 51,572.
BTC / USD daily chart
On the other hand, if sellers have their way, the Bitcoin price decline will continue. A compelling daily close below $ 37,412 will invalidate the bullish outlook and trigger an 8% selloff at $ 34,245.
Etheruem price falls below $ 3,000
The price of Ethereum has performed stellarly in this bullish stage. However, the recent sell-off in the market has pushed ETH below $ 3,000, a significant psychological level. Although this move looks bearish in the short term, the pioneer Altcoin could see a slowdown around the 50-day SMA at $ 2,766.
If buyers come to the rescue, the price of Ethereum could bounce from the level mentioned above. An increase in bullish momentum there could propel the ETH price by 23% to $ 3,430, a level of demand that helped ETH kick off its bullish move in early May.
ETH / USD daily chart
A breakout of the 50-day SMA is definitely bearish and would lead to a 13% drop to the demand zone on the daily chart, which runs from $ 2,106 to $ 2,397. This zone includes the 100-day SMA at $ 2,248. Therefore, the selling pressure is very likely to be exhausted in this region, which could lead to a rapid 50% increase to $ 3,430.
The remote possibility of the ETH price producing a successful daily close below $ 2,106 would invalidate the bullish outlook and cause a 27% drop towards the 200-day SMA at $ 1,544.
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