Bitcoin is having a bad start to the month of August with $20,000 appearing to have flipped to resistance. Following the weekend and Labor Day which contained tight volume and little volatility, Tuesday’s trading was decisive and to the downside. As of 5 PM, ET Bitcoin is trading at a loss of nearly $800 or 4.4% for the day.
Arguably the most significant level for BTC over the past 5 years is $20k. It was the top of the 2017 rally that brought Bitcoin into the mainstream spotlight, and it was the ceiling back in 2020, that when taken out in mid-December 2020 signaled the moonshot was underway breaching $60k in less than 3 months after cracking the elusive $20k.
Today risky assets took a plunge with the Nasdaq losing over 4% and the S&P 500 down by over 3% on the day. Crypto also took a plunge but Bitcoin faired much better than most cryptos posting a loss of over 4% as of 4 PM ET. Ethereum was hit much harder posting a loss of over 8%, so with the merge expected to come next month can Ethereum really trade any lower?
Ethereum’s switch to PoS (proof-of-stake) has been the main focus of cryptocurrency traders, miners, and the overall community for the past month. The Merge is set to be the biggest, most monumental, and highly anticipated event that has and will continue to drastically shape market sentiment in the coming month. However, it is not alone in terms of hype for a September upgrade.
Ethereum made intra-day highs that reached beyond $2,000 on Saturday and Sunday (August 13, 14) but both times the break was extremely short-lived re-affirming that $2,000 is more than just a psychological level of resistance. In this piece, I will outline the technical but more importantly the historical significance of the current level of major resistance in Ethereum, $2,000.
