Market Turmoil Bitcoin Breaks Support Triggering Downside Risks How Should Investors Respond

Bijie.com reported:
This morning, market dynamics after 10 a.m. displayed a wave of decline, breaking through a crucial support level. As mentioned earlier, once the price falls below $56,500, it will pose a disadvantage for the bulls. Currently, the price has dropped below the support line and the 200-day moving average; hence, a conservative approach is recommended.
From a technical analysis perspective, once the support line is breached, it usually signifies a dominance of the bearish market. In such a scenario, the risks of going long are relatively high, with an unfavorable risk-reward ratio. The current anticipated target for the correction is expected to reach $44,000. Therefore, an ideal long position at this point would be to wait for the price to rise back above the 200-day moving average.


ETH is slightly stronger, yet to break below its critical level near $2,850.


The market’s overall performance during the day might seem less active. Further observation will be needed later today, as well as attention to the weekend market trends, hoping for a sideways or slight upward movement as usual. If the downtrend continues over the weekend, the situation may become less optimistic.
Regarding other aspects, there aren’t many new perspectives at the moment. It has been previously assessed that the correction period has not yet concluded, as several key indicators are yet to provide clear signals. The prices for the correction have fallen below critical levels, slightly deviating from the expected trend, hence stringent adherence to trading discipline is necessary.
For those who did not timely reduce positions at $56,500 or missed the opportunity due to hesitation, here is a small suggestion. Traditionally, the market tends to focus on Bitcoin’s performance, as Bitcoin’s behavior typically determines the overall market trend. However, considering some bearish factors currently impacting Bitcoin, such as the German government’s coin sales and the repayment issues in Mentougou, these days it may be worthwhile to observe Ethereum’s performance.
If Ethereum falls below today’s low point again, considering further position reduction might be reasonable. In other words, if you still hold Bitcoin and feel indecisive about what to do, monitoring Ethereum’s performance could provide guidance. Should Ethereum also break down, it might indicate the market is truly facing increased downward pressure.
If Ethereum manages to hold its support level at $2,850, any additional decline in Bitcoin might only be due to its own weakness rather than a shift in the overall market trend, similar to the situation during the end of April when Ethereum did not hit a new low, unlike Bitcoin.