Bitcoin bulls scramble to defend $40,000 as the crypto market sell-off intensifies
Bitcoin (BTC) and altcoins dropped further on Feb. 17 after the situation in Ukraine worsened and Russia expelled Bart Gorman, the United States Deputy Chief of Diplomatic Mission, from the country after President Biden reiterated that the threat of a Ukraine invasion by Russia was “very high.”
Data from Cointelegraph Markets Pro and TradingView shows that the afternoon resurgence in sell-side pressure dropped the price of Bitcoin to a daily low at $40,081 as bulls frantically regroup and attempt to prevent a slide below $40,000.
According to analysts, the bullish case for a move higher continues to dwindle as the factors weighing on the crypto market mount.
Real rates and inflation are the main issues
The effect of the Ukraine-Russia situation was touched upon by David Lifchitz, managing partner and chief investment officer at ExoAlpha, who noted that the situation “is definitely weighing on risk assets, up like Feb. 15, down like today.”
While the Ukraine-Russia saga is currently dominating news headlines and causing widespread weakness across global markets, Lifchitz suggested that the situation “looks like a distraction from the real rates/inflation issue.”
According to Lifchitz, this current conflict may only last a few months while “the inflation/rates issue is a multi-year issue that can hit much more, on a broader scale, and for a longer time.”
“Bitcoin is just pulling back into its $30,000 to $50,000 range for now as we remain in a traders’ market. So unless there’s a significant break below $33,000 or above $48,000, the swing trading will continue and altcoins will follow the move, with just more amplitude.”
Bitcoin remains a strong asset
Despite the recent weakness, market analyst and pseudonymous Twitter trader ‘IncomeSharks’ offered the following words of comfort to help add a little perspective to the long term outlook for BTC.
With everything that has happened over the years how can you not be bullish knowing #Bitcoin is still worth over $40,000? It continues to be worth more almost every single year since it’s inception. This is a stronger asset than people give credit.
— IncomeSharks (@IncomeSharks) February 17, 2022
The overall cryptocurrency market cap now stands at $1.85 trillion and Bitcoin’s dominance rate is 41.7%.
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