Recession is spooking markets and crypto – Where’s Bitcoin new support line?

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Last Updated on 3 August 2024 by CryptoTips.eu

If you’re an investor, there are some words that you don’t want to see popping up too much in the press. I think of terms such as fraud, insider information, bubble, inflation and of course the one that causes the most fear: recession.

Although analysts are falling over themselves to declare that a stock and crypto dip in August (as we have seen in recent weeks on the tech exchanges) is absolutely normal, the word ‘recession’ can now be seen on several major business websites as well.

Although Bitcoin is still trading at a very high level, we are already wondering: where is support to be found if we fall further?

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Federal Reserve

As always with bad news, investors look for someone to blame. Although the United States seemed to be making a kind of ‘soft landing’ (in other words, the economy is slowing down due to higher interest rates, but there is no recession), more and more economists fear that the Federal Reserve has simply kept interest rates too high for too long and that a recession is therefore almost certain to occur. The newest American jobs report that came out yesterday did not bode well either.

Optimists point out that this is simply the effect of the summer months, which are usually bad for the stock market.

Support line

The crypto market is responding in tandem with tech. Bitcoin found support around the $62,000 level earlier this week, but even that isn’t holding this morning

Luckily, well-known analyst Alex Kuptsikevich from FxPro quickly summed them up for us.

“If the decline develops, dynamics around the $63K and $61K levels, near where the 50 and 200-day moving averages are, will be important. A failure of this support will open the way to $55K, which is quite frightening.”

However, Alex also puts things into perspective and reiterates that August is historically very bad for Bitcoin.

“August is considered one of the two worst months for BTC. Over the past 13 years, bitcoin has ended the month up only five times and down eight times. The average decline was 15.4% and the average rise was 26%.”

Jeroen Kok

Jeroen is one of the lead copywriters on Cryptotips.eu and discusses all recent events in the crypto market. This includes news updates, but also price analyzes and more. He developed his passion for cryptocurrency during the bull run in 2017. He has learned a lot since then. The combination of cryptocurrency and creative writing is perfect for Jeroen and an excellent way to share his knowledge with a wide audience. Find me on LinkedIn / [email protected]
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