The price of Bitcoin fell sharply to $15,670 before traders came on the scene to defend the $16,000 level.
The price of Bitcoin (BTC) fell as low as $15,670 at Binance on November 15. The highly volatile drop came hours after the BTC hit $16,355, demonstrating a strong momentum.
Three main factors probably caused the nighttime drop in the price of the Bitcoin Era an the potential factors are a weekend jolt, the daily moving average (MA) retest and a parabola retest.
Senator elected in the US wants to ‚bring Bitcoin into the national debate‘.
Weekend falls and low support retests are healthy
As the Cointelegraph reported, algorithmic traders expected a weekend fall in the Bitcoin market to materialize.
There were a number of sales orders above $16,500 that were not pulled when the price approached $16,400. This meant that the orders were genuine sales orders, applying sales pressure in the cryptomino market.
At the top of the market structure that probably encouraged traders and bots to sell, network analyst Willy Woo said weekend volatility was high.
He said he is expected to get rid of the „technical downside“, but the market still remains in „buy the downturn“ territory. He wrote:
„Weekend trading setup: getting rid of some bearish techniques (4h RSI div, 8h TD9). The fundamentals of the short and medium term chain are optimistic, more currencies withdrawn from exchanges and more users arriving. Buy the diving scenario“.
Currency of R$ 1 values more than 400 times and today it is worth more than R$ 7 thousand
Buying the falls reflects optimism
On the daily chart, the drop to US$ 15.6 thousand confirmed a retest of the 10-day moving average. The retest was important because last week, after a strong rise in prices, BTC retested the same MA before the continuation.
If the price of Bitcoin continued to fall below the 10-day MA, it would mean an additional correction. But the immediate recovery from the same level it recovered from in the November 7 fall is relatively positive in the short term.
On November 7, BTC had a similar fall, albeit in a different price range. The price fell sharply from $15,753 to as low as $14,344, registering a 5% drop. The dominant cryptomeda also recovered from the 10-day MA on the daily chart at the time.
In the next few days, BTC reached a two-year high of $16,480, confirming a strong breakout.
Why Bitcoin fell from $16,000 this weekend
High parabolic needs retests
Josh Olszewicz, technical analyst of cryptomorphs, shared a graph that shows that Bitcoin is in a parable.
During a parabolic bullish trend, the strength of an asset’s rise continues to accumulate as the price increases. But if the parabolic cycle is interrupted, an asset may run the risk of a major setback.
In the short term, the Bitcoin parabola remains intact as long as the BTC remains above the $15,300 to $15,500 range.
Traders and technical analysts have identified similar levels in the past 24 hours. Michael van de Poppe, a full-time trader on the Amsterdam Stock Exchange, said similarly that the $15,500 support level remains critical for BTC in the short term.
In the short term, Bitcoin would need to see continued resilience above $15,500 and ideally defend the $15,700 support as it has done in the last 24 hours.