Bitcoin Sinks Below $21K Following Activation Of Bearish Flag
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Analysts have highlighted that the record crash coincided with unusually strong inflation statistics from Germany. Economic reports showed that annual producer inflation in Germany jumped to a record of 37%, overshooting general expectations of 32% for July. Producer prices refer to the cost of goods and services sold by manufacturers in a given location. In comparison, the US PPI for July was 9.8%.
On-chain data monitoring institutional net flows suggests that large investors (whales) were actively offloading their holdings, which added more fuel to the drop. The report noted that the behavior of whales recently was similar to what was recorded during the 3AC dump.
Meanwhile, veteran analyst Peter Brandt shared his analysis of the situation, asserting that Bitcoin has finally reached the pattern target that has been in formation since mid-July. However, Brandt explained that it does not necessarily mean prices could become extremely bullish in the near term, adding that more downside remains a possibility.
At press time, the flagship cryptocurrency trades at $21.4K or +1.2% today.
Key Bitcoin Levels to Watch — August 21
The Bitcoin crash sent the cryptocurrency and most of the crypto industry into multi-week lows, erasing weeks of efforts by bulls. Friday’s crash came after a rejection from the $25K mark and was the worst daily plunge since June 13.
The benchmark cryptocurrency has now completed the bearish flag pattern, which started in mid-July. As suggested by Peter Brandt, this could be a bottoming of this pattern, and a bullish resurgence is just around the corner. To support this bias, the daily stochastic indicator shows a complete easing out of oversold conditions and the preparation for a possible boom over the coming days.
Meanwhile, my resistance levels are at $22,000, $23,000, and $24,000, and my key support levels are at $21,000, $20,000, and $19,000.
Total Market Capitalization: $1.03 trillion
Bitcoin Market Capitalization: $409.6 billion
Bitcoin Dominance: 39.9%
Market Rank: #1
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