On March 10, Bitcoin plummeted to $80,000, leading to $650 million in liquidations. A U.S. government plan for a Strategic Bitcoin Reserve triggered a 7% price drop. Currently, Bitcoin faces resistance at $86,000 and risks further declines towards $78,000. Investor sentiment is notably fearful, with the crypto fear and greed index at 17.

As of March 10, Bitcoin has faced a significant price decline, reaching a low of $80,000, causing $650 million in market liquidations within a single day. This downturn, driven by intense selling pressure, is raising concerns among investors regarding the potential for further declines. Currently, the cryptocurrency is wrestling with resistance levels around $86,000, risking a fall towards the $78,000 support. The crypto fear and greed index has plummeted to 17, indicating a strong sentiment of fear in the market.

The recent drop in Bitcoin’s price can be attributed to the United States government’s announcement of a Strategic Bitcoin Reserve. This plan, which does not include new Bitcoin purchases, unexpectedly triggered a 7% decline in Bitcoin’s value. While former President Trump has instructed officials to find budget-neutral ways to acquire Bitcoin, the lack of a defined purchasing strategy raises uncertainties regarding the reserve’s market impact. The Bitcoin held as a reserve will primarily comprise assets seized by the Department of Justice.

Market liquidations have compounded the selling pressure, with approximately $650 million liquidated in the last 24 hours, reported by CoinGlass. Long traders were the most affected, recording nearly $500 million in losses, whereas short traders faced about $147 million in liquidations. Notably, the largest single liquidation occurred on Binance’s BTCUSDT pair, amounting to $32.09 million.

Following this sharp decline, Bitcoin witnessed a modest recovery of around 2%, climbing to approximately $83,400. Analyst Michaël van de Poppe has indicated that Bitcoin’s price chart is currently at a critical juncture. If Bitcoin can establish a new higher low from its current position, a potential breakout may ensue. However, persisting struggles beneath the $86,000 level could lead to a deeper correction, possibly testing the $78,000 support level. The recent price bounce has also resulted in the Relative Strength Index (RSI) moving from oversold territory to a weaker zone, suggesting continued seller dominance.

In summary, Bitcoin’s price is experiencing significant pressure due to market liquidations and the U.S. government’s strategic reserve plan. With the cryptocurrency positioned beneath key resistance at $86,000, the potential for further declines looms. Traders watch closely for signs of recovery or further correction as investor sentiment remains overwhelmingly fearful amid these developments.

Original Source: coinpedia.org

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