Bitcoin prices continue to be highly volatile and it is certainly not a market for the faint hearted at this point of time. We had warned of the same once the prices reached $10,000 that with the main psychological mark, which would have been the target for many traders and investors, having been achieved, we could see a lot of profit taking and uncertainty in the market on whether the bull run would continue or whether there would be a reversal. This has led to a sell off in the bitcoin market which has since pushed the prices from above $11,000 to the $9,000 region in the short term and though there has been a strong bounce, the trading has been very choppy.
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Bitcoin Prices Volatile
We have seen the prices bounce above $10,000 and then move into the $9,000 region once again and this kind of choppy trading has made the life of the traders a bit difficult. We are also seeing increasing regulation of the bitcoin market from various countries and with increasing regulation comes increasing taxation and control as well. So, this spurs even more selling among those who do not want to get dragged into the tax net and this has added to the selling in the bitcoin market in the last few days. This kind of choppy trading is expected to continue in the short term.
The Ethereum market has also been hit by some strong selling and we saw the prices dropping back into the $400 region where it found a bit of support. It has since bounced off from that region towards the end of the day and trades above the $420 region as of this writing and like the BTC market, the ethereum market has also turned choppy making it quite difficult to trade though it has to be said that the market has been able to maintain its price action between the strong support and resistances.
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Forecast
Looking ahead to the rest of the day, we believe that the choppy price action that is being seen in the BTC and the ETH markets is likely to continue for the short term. Traders need to be careful while trading in such markets and stick to areas of strong support and resistance.
Looking ahead to the rest of the day, expect some more volatility in the BTC market as the traders decide whether the bullish leg would continue in the short term or whether they would like to take some profits off the table leading to consolidation and correction as well. The ETH prices are expected to stay steady during the course of the day as the traders get ready for the next bullish leg.