Bitcoin Fall Has Strategists Seeing Possible Drop Toward $20,000

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Another bad week for Bitcoin could herald more pain, according to strategists watching the cryptocurrency sell-off.

Further price weakness could consider the $ 20,000 zone as a downside target, according to Oanda Corp., Evercore ISI and Tallbacken Capital Consultant GMBH. Bitcoin fell about 2% to $ 33,000 at 11:23 a.m. in Hong Kong and is down about 10% so far in June.

The largest cryptocurrency is “dangerously nearing the $ 30,000 level” amid growing regulatory fears in the US, and “a break of $ 30,000 could create tremendous sales momentum,” said Edward Moya, senior market analyst at Oanda Corp. .

Bitcoin is down roughly $ 32,000 from its April record, shaken by a reprimand from billionaire Elon Musk about the energy needed and renewed crackdown on China’s regulators. The ability of US authorities to reclaim a high-profile Bitcoin ransom has also marred the notion that it is beyond government control, which was a tenet of belief for some supporters of the coin.

Evercore’s technical strategist Rich Ross and Tallbacken Capital Consultant‘Michael Purves have both marked the $ 20,000 area as a potential key level if Bitcoin plunges much deeper than it is now.

Others, however, remain optimistic about the longer-term outlook. For example, Michael Saylor’s MicroStrategy Inc. increased a junk bond sale from $ 400 million to $ 500 million to fund the purchase of more Bitcoin. MicroStrategy has grown into one of the most optimistic public companies around cryptocurrencies.

About a week after Bitcoin’s all-time high in mid-April, Purves had argued that the bullish fall looked “very challenged.”

“How much deeper can it go?” Purves asked in his note on Tuesday. “The most obvious answer is still to fully trace the outbreak from $ 20,000 – in other words, back to $ 20,000.”

– With the support of Joanna Ossinger

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