By Samuel Indyk
Investing.com – The price of Bitcoin dropped below $30,000 for the first time since 22nd June on Tuesday morning as the selloff in cryptocurrencies deepened.
There was no major fundamental catalyst for the move lower in the cryptocurrency space but some analysts have cited the broad risk-off tone in the market as the reason for the latest leg lower.
Yesterday saw heavy selling pressure in equity markets across the globe, with the Dow Jones falling 2.1% and the FTSE 100 lower by 2.3%. However, European indices have shown some signs of recovery on Tuesday morning, with the FTSE 100 up 1.1% and the DAX up 0.9%.
Fears over the strength of the global economic recovery, amid the continued spread of the Delta variant, continues to weigh on riskier assets and there are few assets that are more risky than Bitcoin and cryptocurrencies.
When Bitcoin dropped below $30,000 last month, the retreat below the level lasted just a few hours before bouncing and returning above that level.
On a technical basis, the next level of support to the downside could be the $29,000 level before a test of the 22nd June low at $28,900.
Below that and some analysts are calling for a drop to as low as $20,000. However, some have argued that the lower price of Bitcoin and cryptocurrencies might attract increased institutional investment.
At 08:50BST, Bitcoin was trading at $29,800, down 5.8% in the last 24 hours. Ethereum was trading at $1,760, down 7% and XRP at $0.53, down 9%.
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