Cryptocurrency giant Bitcoin is in free fall, as pressure on cryptocurrency regulations grows as does fear and risk aversion, after US Treasury Secretary Janet Yellen called for a regulatory framework for stablecoins during a session of the Senate banking committee, and on Tuesday, May 10, the United Kingdom presented two bills for the regulation of cryptocurrencies: first the Financial Services and Markets Bill to mark the "secure adoption of cryptocurrencies" and the second Economic Crimes and Corporate Transparency Bill to create authorities with the power to “seize and recover crypto assets” to reduce crypto hacking risks.
This news, together with the risk aversion of volatile assets due to the measures of central banks to tighten their monetary policy, and the lockdowns in China, have created a lack of demand on the part of buyers who have initiated a downward trend from its historical maximum at $68,900 on November 21, but the price has aggravated its fall in the last five days reaching more than 55% total discount, and more than 61.8% since its last strong bullish momentum in November 2020. In the past two days, more than 44,246 bitcoins have been traded in sales by large investors known as “the whales” making it even more difficult to determine the direction of the cryptocurrency.
However, such a drop to lower prices presents opportunities for investors, such as for the country of El Salvador that has adopted BTC as an official currency and announced a purchase of 500 BTC from its fund taking “advantage of the discount”, or “trying to catch a falling knife”, depending on your outlook, increasing the country’s fund to 2,301 BTC.
This week the price of BTC has broken all the previous lows seen in 2022 and 2021, sending the price to 2020 levels, from the last weekly close at $36,066 to mark a minimum at $26,663 so far, without ruling out an even greater fall after the breakout of the $30,000 and the 61.8% level at $28,677. In the daily timeframe we can observe the distribution of sales from its historical maximum to leave a minimum at $32,931 to form a flag that broke down after marking highs at $48,153, taking the price to the breakout that could launch the price to the support range marked by the $20,000 and the 78.6% level at $17,716. The ADX is at 38.36 with +DI at 6. 81 and -DI at 32.41 – bears very much in control.
