Bitcoin on Friday broke below a short-term support line at $9,000, extending selloff in the previous session that took all major currencies into the red for the week.
A single bitcoin
last traded at $8,721.17, down 4.1% since Thursday’s levels at 5 p.m. Eastern time on the Kraken exchange.
The price of the No. 1 digital currency had spent the best part of the week consolidating after nearing the $10,000 mark late last week. However, that phase now appears to be breaking, giving some analysts cause for concern.
“It’s worth noting that while this could be a significant breakout to the downside, we have pierced the $9,000 level a few times throughout this time but each time price has rebounded back above,” wrote Craig Erlam, senior market analyst at Oanda in a research note.
“A significant close below here today could signal another period of downside for bitcoin, which has seen a number of false dawns since the collapse in its price around the turn of the year.”
Mining economics have bitcoin on track for record high
In a Thursday research note, Fundstrat Global Advisors, one of the markets biggest crypto bulls, said the bitcoin mining price dynamics have the No. 1 digital currency on track to reach $36,000 by the end of 2019.
Mining efficiency is an important facet of the cryptocurrency market, and Fundstrat said that higher hash power—the processing speed required by computers to generate a bitcoin—will propel bitcoin to a new all-time high.
“We believe the current path of hash power growth supports a BTC price of about $36,000 by 2019 year end, with a $20,000-$64,000 range,” wrote Sam Doctor, head of data science research at Fundstrat.
The company notes that the price to break-even cost metric (P/BE) provides an important support level for those mining digital currencies.
On Monday, Fundstrat said bitcoin could rally as much as 70% during the coming Consensus 2018 conference in New York City.
Read: Here’s how much it costs to mine a single bitcoin in your country
Most altcoins are showing significant losses to begin Friday. Ether
has lost 6.8%, trading at $686.09, Bitcoin Cash
has shed 11.4% to $1,372.50, Litecoin
is down 6.7% at $141.22 and Ripple’s XRP
is the worst performer, down 12.2% at 68 cents.
Bitcoin futures have tracked spot lower with both major contracts showing heavy losses to begin Friday. The Cboe Global Markets Inc.’s May contract
is down 4% at $8,730 and the CME Group Inc. May contract
is off 4.5%, last trading at $8,685.
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