Bitcoin broke through the support level of $6900 again, having been traded at $6550 on several exchanges. Trading volume increased 1.5 times and reached $43 billion. Cryptocurrency capitalization fell below $200 billion.

Recall that the first cryptocurrency rate began to fall on Thursday, November 21. The price of BTC suddenly fell by 7%, reaching $7350. Further, the situation stabilized, but on Friday the coin showed a loss of -10.83%.

The cryptocurrency lost in total about 2 thousand dollars or 22% of the previous maximum of $8727 over the past 5 days. What caused such behavior and what to expect next?

Analyst Tone Vays considers, the bear market may be extended, and BTC will update the lows, falling to $4,500. The charts show it is possible if the bulls cannot raise the price of the cryptocurrency to the support level of $7350.

The next strong resistance level is in the range of 3.5-2.5 thousand dollars. The moving average of $9600, which is now the resistance level, seems unreachable. However, we all know how unpredictable Bitcoin can be. 

Possible reasons for the cryptocurrency drop

Besides factors we already mentioned last week, there are a number of others:

1. 7000 BTC Transfer from the Plus Token project wallet to the Huobi exchange

Some explain Bitcoin’s rate drop was caused by the scam project Plus Token, which sold 7000 BTC on Huobi on November 22. It was possible to track since the bulk of the project funds (38,000 BTC) concentrated on one wallet.

Fraudsters have been selling 600-1000 BTC per day onto the exchange until November 22, and then, frightened by the bearish trend after “Bloody Thursday”, immediately transferred 7000 coins to Huobi. The increased supply has reduced the digital asset rate.

Recall that the fraudulent scheme allowed the creators of the project to raise more than $2.9 billion (200 thousand BTC and 800 thousand ETH). So, most likely, this was not the last mass sale of cryptocurrency.

2. Chinese reaction on Plus Token

The above-mentioned scam project has also become one of the reasons for the “cooling” of the regulatory and news background in China. The research of the fraudulent scheme shows, the bulk of the funds were raised through Chinese investors.

After the Plus Token trial, China has increased its control over the cryptocurrency projects. Local exchanges are under increased pressure, a wave of arrests followed. This has led to a stock and OTC trading weakening.

3. New futures trade record on Bakkt

Another possible factor that hit Bitcoin is the success of futures trading on the Bakkt platform. On Friday, November 22, trading broke all records. At 02:00 PM (UTC + 3), the exchange announced on Twitter a significant trading volume to 1863 monthly futures for a total of $13.4 million.

Short-sellers tactics could make additional pressure on the falling market. The same happened on November 9 during the previous record (1741. – Editor’s note) when the BTC rate fell below $9,000.

As of press time, we can see a slight correction in the Bitcoin rate. The coin rose to $7,222.7, showing a +1.42% increase per day. The first five altcoins followed BTC, and only Ripple is still in the red at -2.21%. We will monitor developments and keep you informed.

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