Recently, bitcoin – the world’s number one cryptocurrency – rose beyond the $12,000 mark all the way to $12,400. This was huge news for every trader, big and small, though at the time of writing, things have shrunk back a little bit for everybody’s favorite digital currency.
Bitcoin Has Taken a Fall
As it stands, bitcoin is now trading for just over $11,800. While this isn’t as bad as where it stood yesterday ($11,600), things still aren’t quite where they were, and many analysts and industry experts are asking themselves what exactly happened to make bitcoin suddenly retract some of its recent momentum.
The sentiment is that bitcoin has, once again, fallen to those looking to cash in on bitcoin’s recent gains. This is a problem that the currency has encountered before, particularly whenever it surges a bit. As bitcoin has now surged past the $12,000 line, many users have noted that this was the resistance level that many analysts were telling them to watch out for. Since bitcoin managed to surpass it, things must be great for the coin, correct?
Well, sort of. Naturally, if bitcoin can rise beyond the resistance in front of it, it’s got the strength and endurance necessary to continue its bullish run into newer and richer territories, but this isn’t necessarily going to happen overnight. Bitcoin needs time to gather its thoughts and devise a new strategy for hitting these territories, but that’s not going to happen if people sell their stashes ASAP.
This appears to have been what happened. Bitcoin passed its latest resistance level and people thought to cash in early. This ultimately had a negative effect on the asset and brought it back down to its previous level.
Too Much Selling Going On
This is an unfortunate incident that at this point, appears relatively unavoidable for those who trade BTC. There are always going to be people in it for the short-term. People who want quick cash or fast rewards and can’t contain themselves enough to keep their wallets in check. Thus, they sell their stashes – or at least part of their stashes – way too early, preventing bitcoin from moving further and ruining the environment for others who are in it to win it.
Bitcoin is a currency that clearly requires time to get where it’s going. Whenever it’s risen to high marks, it’s done so at a slow and steady pace. Even its rise to $20,000 in December 2017 didn’t occur overnight. Things had been moderately bullish since the end of 2015. After a dismal year, the currency had finally managed to rise into the $300 range, and from there, things kept spiking further, but this jump took a whopping two years, so anybody who looks to cash in the moment bitcoin incurs any sort of rise is going to make things rough for long-term traders.