Bitcoin Price Drops by 3% and Everybody Panics for no Reason
Although the year 2017 has been pretty positive for the Bitcoin price in general, all positive momentum will come to an end eventually. In this particular case, the Bitcoin price is dropping pretty hard all of a sudden. There’s no real reason for this sudden change, mind you, but it is evident people are cashing out with the Christmas holidays almost upon us. No one knows for sure how bad things will get, but for now, it’s time to diversify into altcoins.
BITCOIN PRICE GETS A DECENT SHAKE-UP
It is always important to put things into their proper perspective. Any sort of Bitcoin pricemovement will eventually trigger a cascade of movement across all cryptocurrency markets in quick succession. Right now, we saw the Bitcoin price drop by around 3% in the past hour and every other market is immediately taking a big hit. It is unclear why that is happening, though, considering a drop in Bitcoin price is a strong signal to buy some altcoins in the process. Then again, cryptocurrency has never been a rational market, and that situation will not change anytime soon.
Even though the Bitcoin price is still holding its own quite well around the $18,000 level, it is not surprising to see this price drop occur right now. Christmas is less than a week away and people want some spare cash to buy last-minute presents. It is very likely we will see some small price movements in the coming days, although no major long-term shakeups are expected in the process. At the same time, this may also be the beginning of a decent Bitcoin price correction, which has been long overdue.
A 3% drop for Bitcoin mains a $600 difference at this point in time. It’s not the biggest change we have seen in the Bitcoin world throughout the years. Those who have been around for some time will remember the 90% retrace after the Mt. Gox debacle a few years ago. This small drop means absolutely nothing and it is quite disconcerting to see the altcoin markets respond in such a negative manner. Again, the lack of rationale in cryptocurrency combined with a growing number of panicky people will increase volatility over time.
Bitcoin still has a nice trading volume of nearly $16bn in the past 24 hours. Rest assured this number will rise a bit as a few people will panic sell before things level out again. More specifically, the Bitcoin price will eventually continue to bleed very slowly or go into sideways trading motion for the rest of the year. There is zero reason to expect a Bitcoin price of $20,000 before the year is over, even though the rest of 2017 has thrown a few curve balls in this regard