Bitcoin drops through support after Twitter hack

Bitcoin has dropped to lows of $9,026 after losing key support zone at $9,150 and analysts predict a pullback before an upswing

Bitcoin price has dropped to lows of $9,026 in the past 24 hours and could slip even lower if price action follows historical moves. Meanwhile, Bitcoin is receiving widespread media coverage thanks to a Twitter breach.

A hacker succeeded in scamming unsuspecting Twitter users of around 12 bitcoins worth $110,000 after hacking into the accounts of major crypto firms and global personalities to promote a Bitcoin scam.

Accounts belonging to Binance, Gemini, Coinbase as well as those of Justin Sun, Charlie Lee, Bill Gates, Joe Biden and Elon Musk all sent out a tweet that asked followers to send Bitcoin to a certain address for a fake project dubbed, Crypto for Health.

The hack has received widespread coverage in the mainstream media, with the crypto market reaction appearing to be a downturn in the price of Bitcoin.

Most cryptocurrencies in the top 10 are trading in the red. Source: Coingecko

BTC/USD loses grip at $9,150

Bitcoin’s price is teetering close to $9,000 and might need a sentiment flip in the macro markets to prevent a slide to levels under $8,800.

Already, positive sentiment over a coronavirus vaccine has failed to excite the market and a worsening scenario on the global geopolitical scene could mean more bad news.

BTC/USD has failed to hold above $9,200 since June’s monthly close below $9,400. Analysts are pointing to a pullback in the coming days or weeks, citing charts that show price compressions have historically been followed by a slight downturn before rebounding to higher levels.

The chart below shows that since the bull market of 2017, Bitcoin has had multiple rallies. However, each one of these has seen subsequent compression followed by a pullback before prices rallied once again.

Although other external factors may be at play to mean the market may be different this time around, several analysts believe a “fake-out” will occur.

Bitcoin price chart suggesting a pullback before another rally. Source: Twitter

Yesterday’s report highlighted the tightening Bollinger Bands which suggested a decline was possible. That scenario is supported by the outlook on the daily charts.

Bitcoin daily charts.Source: TradingView

BTC/USD has slipped below its 50-day MA. Bulls are now likely to defend prices at the 100 and 200 MA at $8,871.59 and $8,509.42

The MACD is pointing to indecision among the bulls, with intraday trading volumes shrinking.

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