What to watch out for after the $ 30,000 cryptocurrency breaks

Bitcoin fell again on Tuesday, this time falling below the critical level of $ 30,000.

This award was highlighted by institutional investors as a key level of support.

Despite the market rebounding slightly on Tuesday, this move in bitcoin comes as investors seek to mitigate risk with the spread of the delta Covid variant putting additional pressure on the broader market.

Other cryptocurrencies were also down on Tuesday. Ether, Litecoin, and Dogecoin all spent the day in the red.

In an interview with CNBC’s “Trading Nation,” Delano Saporu, founder of New Street Advisors, said he anticipates more pain for bitcoin.

“I think you probably have more downsides, maybe around $ 22,000 [to] the $ 17,000 range for bitcoin goes back to December 20 of last year, ”he said on Tuesday. However, “from there I think there will be a rise,” he said.

While short-term traders who invested in bitcoin at its highest level are now feeling the pain, Saporu sees cryptocurrency paying off for long-term investors.

“A lot of people who speculated when the price was really at its highest and they jumped in at that point were really looking for a quick profit,” he said. “They were wrong then.”

In the same interview, Fairlead Strategies founder Katie Stockton said bitcoin investors might feel the pressure a little longer.

“This marks the lower limit of a phase of consolidation,” she said of the move below $ 30,000. “With that it becomes what I call ‘ripe for a shakeout’.”

According to Stockton, a shakeout is a “false blackout” where the price of an investment drops below a support level. After that drop, the price could quickly come back once the market “shakes up those weak bitcoin holders,” she said.

If bitcoin bounces back this week, she said, that would be a sign that this sale was temporary.

In addition, its model indicates that bitcoin is going higher. She pointed out a secondary support level at around $ 27,000, which would be important in defining her long-term uptrend.

Stockton added that she needs to see the momentum turn to prove this phase of consolidation is bottoming out. She predicts this would happen when bitcoin breaks the 50-day moving average, which is around $ 34,500 at current levels.

“It would be a compelling turnaround for bitcoin,” she added.

Disclosure: Delano Saporu holds bitcoins.

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