Bitcoin price (BTC) has continued to face stiff resistance to trade above the $7000 level over the last two weeks. The tug o’ war between bulls and bears intensified in the last month; bears are holding tightly to the crypto markets since the advertisement ban from major social platforms, along with the global regulators increasing regulatory demands.
Bears have successfully plunged bitcoin price by almost 30% in the last month alone, down 50% since the start of this year. The largest crypto coin, however, finds the support around $6600. BTC trades around $6700 today.
Market pundits are blaming various market reports for the bearish trend, including the tax season and increasing taxation on cryptocurrencies.
Thomas Lee, head of research at Fundstrat Global Advisors, said: “This is a massive outflow from crypto to USD and historical estimates are each $1 of USD outflow is $20-$25 impacts on crypto market value. Additionally, we believe there is selling pressure by crypto exchanges that are subject to income tax in U.S. jurisdictions.”
Technical Factors Forming Bearish Trend
Technical indicators aren’t also supporting bears stance. Technical charts created a “Death Cross” pattern last week when its 50-day moving average crossed the 200-day moving average from the top – which creates a substantial bearish trend for Bitcoin price.
Technical analysts give significant importance to moving averages when it comes to price prediction. BTC moving averages aren’t favoring bulls at the moment. The majority of critical moving averages are forming bearish trends as shown in the chart below.
Uncertainty Has Also Favored Bears Stance
The cryptocurrency market is under pressure and traders are uncertain about the prospects. Regulators all around the globe are making it difficult for money launderers and criminal to use cryptocurrencies for illegal activities – they are demanding that crypto exchanges track the record of traders.
Australia, for instance, recently introduced guidelines for cryptocurrency exchanges. They asked exchanges to hold a registration certificate along with complying with counter-terrorism financing and anti-money laundering laws. They also want virtual currency exchanges to verify the “identities of their customers along with keeping the record of last seven years.”
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