Bitcoin price was headed for its worst week since November 2022 on Friday as volatility, buoyed by low liquidity continued to outweigh crypto markets. Bitcoin has dropped below the crucial support level of $26,500, changing hands at this level. The asset’s price has dipped by more than 11% in the past week, while its total market cap inched lower to $516 billion.
Bitcoin price has been on a downward trend for seven consecutive days amid congestion in the network’s system and the regulatory crackdown on cryptocurrencies. The digital coin has been struggling to gain bullish momentum for the past few days. Bitcoin is currently up by 60.54% in the year to date, but its prices have remained volatile.
The crypto market has been battling low liquidity, regulatory crackdown, and macroeconomic concerns. Data by Coinmarketcap shows that the global crypto market cap has slipped to $1.11 trillion, down from $1.27 trillion earlier in March. Bitcoin’s dominance has also inched lower in the past few days.
The regulatory crackdown on cryptocurrencies has ramped up since the fall of crypto exchange FTX. Ripple Labs has been in a lawsuit against the US Securities and Exchange Commission (SEC) over the last year over concerns about its native coin XRP. Additionally, SEC recently warned Coinbase over potential securities law violations. Binance, the largest cryptocurrency exchange platform, was recently accused of violating trading rules by the Commodity Futures and Trading Commission (CFTC).
Notably, Bitcoin has been experiencing congestion on its network for the past few days, prompting Binance to halt the withdrawal of the asset twice in 24 hours earlier this week. The halt saw transaction fees surge and while they are coming down, they remain elevated.
The US dollar was headed for its biggest weekly gain since February on Friday amid uncertainty in the US debt ceiling and monetary policy. At press time, the US dollar index was trading 0.68% higher at 102.2589. The US Treasury yields were also in the green on Friday with the 2-year Treasury yield up to 3.991% and the yield on the 10-year Treasury yield at 3.463%.
The daily chart shows that the Bitcoin price has been in a freefall in the past week, dropping below the crucial level of $28,000. BTC hit an intraday low of $25,811 earlier on Friday, below the crucial support level of $26,500. The coin has remained below the 50-day exponential moving average and simple moving average. Its Relative Strength Index (RSI) has moved lower, suggesting an increase in selling pressure. The Moving Average Convergence Divergence (MACD) indicator has also remained bearish.
Consequently, the Bitcoin price is likely to fall further in the ensuing sessions as sellers eye the next support levels at $25,265.50 and the 200-day EMA. On the flipside, a move past the 50-day EMA will invalidate the bearish thesis.