Sciencelovers - The impact of the Russian invasion of Ukraine on cryptocurrencies was truly massive, a little more than previously thought....
Earlier on Thursday (24/2/2022) early in the morning, Russia started a massive invasion of Ukraine. President Vladimir Putin called it a military operation to protect two major cities that had liberated themselves and were about to join Russia. Capital and forex markets reacted surprisingly negatively to this news, crypto and of course Bitcoin is no exception.
The sharp decline yesterday and possibly the next few weeks, follows the negative sentiment after Bitcoin lost its $41,000–$44,200 range. The failure to hold on and the price breakout, reflects that the bears remain in control. Prices have continued to fall since then.
A warning sign at the start of the week is that the Long/Short ratio becomes parabolic, as Bitcoin price continues to decline. This gives an even stronger signal, that many traders tried to buy the dip (buy-the-dip), but were unsuccessful, in fact the sell-flow was much stronger. See the image below.
Based on the image above, the Long/Short Ratio per night yesterday, has entered a more neutral level, and in today's sharp drop in prices, the funding rate was very negative and made new short-term lows on the Binance Futures contract.
So, not surprisingly, with the recent acceleration of the downtrend, bears are now appearing across all time-frames. In this situation extra caution is highly recommended in the near term, at least until we start to see some certainty of a trend change.
Beware US$25,253 Area
If the price continues to decline, the weekly 20 Moving Average (MA) crossing line illustrates a potential support area for Bitcoin, between US$29,382 and US$25,253. The last period of such a situation, namely in March 2020, hopefully, is closer to the end of September 2021.
"If the price drops below that price, then the last major support will be the 200 MA (US$20,000)," according to Decentrader's study, Thursday (24/2/2022).
Peter Brandt: Bitcoin Correction Could Take Months
Long before this invasion, veteran US trader Peter Brandt had warned that Bitcoin correction would take months.
Peter Brandt, a veteran trader from the United States, said that Bitcoin's correction would take a long time. The weakening performance of Bitcoin is usually followed by a decrease in the price of other cryptocurrencies.
The influential analyst warned that Bitcoin's correction would take months following past corrections, before printing an all-time high.
He also did not forget to criticize Bitcoin defenders who massively argue excessively. According to him, such blind views are actually detrimental to novice traders.
“As before, the price of Bitcoin took months to reach an all-time high. The current correction could do something similar. The rise in between is not a lasting hype," Brandt said on Twitter Friday.
