Bitcoin (BTC) Price Struggles to Climb $8,000 after Hitting Two-Month Low
Bitcoin dropped majorly alongside global equities following coronavirus fears and tanking oil prices. Now, it appears the digital currency is trying to bouncing back.
Bitcoin (BTC) reclaimed the $8,000 mark very briefly on Tuesday after a dramatic fall to a two-month low on Monday. At the time of writing, BTC is at $8,032, having climbed 4.10% over the last 24 hours.
The top cryptocurrency by market value dropped by nearly 10% from $8,900 to $8,000 on Sunday, marking its biggest daily fall since September 2019. On Monday, BTC extended the losses to reach a two-month low of $7,625.
According to some analysts, scammers associated with China-based PlusToken, a Ponzi scheme that drew significant funds from investors, were possibly unloading their crypto holdings, placing severe downward pressure on Bitcoin prices. BTC’s slide was also fuelled by Coronavirus epidemic fears, which are affecting all traditional markets. In the last three days, oil prices have plunged over 30%, while the S&P 500 suffered the biggest loss since the 2008 financial crisis.
Shaking off the panic caused by Covid-19 outbreak and its effect on the global economy, most assets, including Bitcoin, began a modest recovery on Tuesday. Major European equity indices including France's CAC and Germany's DAX are on the up today. The S&P 500 futures are also flashing green, while oil prices have climbed 7%. The positive trend is expected to continue with hopes for fresh fiscal stimulus from US authorities set to improve investor sentiment.
Most analysts and cryptocurrency enthusiasts expected Bitcoin to go up in such an environment. And while the BTC safe-haven narrative has not been proven, gold is also suffering amid the current risk aversion and anxiety.
Moving forward, however, it remains to be seen whether gold can rally back towards the critical $10,000 level, which it crossed briefly in the first half of February 2020.