The situation looks like the bitcoin bullish trend is completely broken

Bitcoin failed to recover on Tuesday despite a rebound in risky assets and stocks in the afternoon. The reason for such dynamics was a new legislative initiative of the European Union.

The document, prepared by the European Commission, implements the Financial Action Task Force (FATF) initiative across the EU, prohibiting exchanges, wallet operators and any company from accepting and sending digital currency transactions without complete personal KYC data.

In fact, the European Union becomes the first jurisdiction to accept the FATF rules, writes cryptor. It will take at least two years to fully agree on the law, but with the support of the EU, the initiative for the deanonymization of crypto transactions will be unequivocally supported by developed countries at the international level.

Investment company Ruffer sees the global reason for the fall in cryptocurrencies in the emergence of a price bubble due to the sharp winter growth of digital assets. The price of bitcoin was not fundamentally justified, the entire six-month trend was a hype, fueled by tweets by Elon Musk, the IPO of Coinbase and the rise of meme cryptocurrencies.

Analysts at Bloomberg and Coindesk note that the collapse of BTC led to a breakdown of the 50-week moving average (MA). This is the third case in the history of BTC trading, the first two resulted in the maximum acceleration of sales.

Bloomberg Intelligence’s Mike McGlone believes the 50-WMA breakdown this time will push bitcoin down to $ 13,000, 80% below this year’s high. There is also the cost of mining cryptocurrency, which serves as a significant support in all periods of similar, significant price corrections.

“The situation looks like the bullish trend has been completely broken. Now the question of the fall of bitcoin up to $ 23,300 becomes relevant, where it took a break in growth before last Christmas. It cannot be ruled out that in the event of a massive liquidation of margin positions, the price will even close the gap in the area of ​​$ 18,000.

In general, such a turn of events will be a repetition of the “crypto winter 2018”, opening up the opportunity for a commensurate collapse in BTC with a “bottom” near $ 10,000, nullifying the rally from October 2020, “the FxPro team of analysts notes.

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