In a surprising turn of events, Bitcoin's price, which had been on an upward trajectory, spurred by Ripple's victory over the SEC, has taken a significant hit. The cryptocurrency, which had been flirting with the $32K mark, saw a decrease in buying pressure leading to a substantial decline.
The bullish momentum that had been driving Bitcoin's price suffered a setback as the price dipped below the $31K mark. The cryptocurrency is currently grappling with maintaining its momentum, leaving investors and market watchers speculating about the next support level for Bitcoin's price.
Market Response to Regulatory Developments
The swift gains that Bitcoin experienced the previous day are now being consolidated as the market attempts to solidify support. The news of a U.S. judge endorsing the notion that the altcoin XRP does not qualify as a security was met with immediate response from Bitcoin's price. However, the SEC's attempts to categorize altcoins as securities have been viewed as a setback by the markets.
The inability to sustain the momentum at $31K has led bullish traders to lock in their profits. The aggregate open interest for Bitcoin options on Deribit for July 15 indicates a 1.16 put-to-call ratio. This highlights the difference in open interest between the $339 million call (buy) options and the $398 million put (sell) options. Sellers are heavily wagering on a drop to $30K by tomorrow, setting the maximum pain point at $31,000.
Bearish Bets and the Road Ahead
As Bitcoin fell below the $31K mark, bullish traders exited their positions, leading to a surge in long liquidation to $30 million. This exerted downward pressure on the price chart and reinforced the bearish prediction of a drop to $30K.
At the time of writing, Bitcoin trades at $30,220, marking a decline of over 4% in the last 24 hours. The bears are finding it challenging to hold this momentum, indicating that they are still in the game, selling off at higher levels.
The bears will attempt to drag the price back beneath the $30K level. If successful, the BTC price could descend to the crucial level of $29,500. A rebound from this point would imply that the market sentiment remains positive and traders are purchasing during price dips. A surge above $32,500 could pave the way for a potential climb to $40,000.
However, a break and closure below the $29,500 will intensify selling pressure. For the bears to gain control in the short term, they would need to send the price to $27K.
As the crypto market continues to navigate these turbulent waters, it's clear that the next few days will be critical in determining Bitcoin's trajectory. Stay tuned for more updates as we continue to monitor this developing story.
