Here’s What Caused Bitcoin’s Sudden Drop to $29,000

After reclaiming this support from the bears, bitcoin was trading above $31,000 for most of Friday. However, this did not last long as the digital asset witnessed a sudden drop that pushed its price towards the $29,000 level.

SEC says ETF filing is insufficient

The Wall Street Journal released a release on Friday reports Which had a negative impact on the market. The report revealed that the United States Securities and Exchange Commission thought the recent obfuscation of Bitcoin ETH filing it received was insufficient in their filing.

This follows a two-week extension of positivity after heavy hitters such as BlackRock, WisdomTree and Fidelity filed requests with the SEC for a bitcoin spot ETF. Following the news of the filing, the price of bitcoin skyrocketed, surpassing $31,000 for the first time in a month.

However, news from the SEC that the filing was insufficient has sharply dampened investor sentiment. The BTC price dropped to $29,200 on Friday afternoon, before recovering sharply. However, the damage is already done and BTC bulls are now struggling to hold the $30,000 support.

bitcoin in freefall

Bitcoin has been able to establish a fairly bullish trend over the past few weeks. But this did not last long as the SEC came to burst the bubble for investors. As a result, bitcoin is in a freefall with no proper support to keep the price from falling further.

BTC struggles to hold $30,000 | Source: BTCUSD on TradingView.com

In a matter of hours, the digital asset lost nearly $1,000 in its value, turning a previously good day into a bloody one for investors. This sharp decline has pushed the cryptocurrency below its 5-day EMA, which could lead to a bearish move for BTC over the weekend.

However, in the medium and long term, the digital asset remains as bullish as ever, trading well above both its 50-day and 100-day moving averages. Both of these levels indicate that even though the bears have temporarily regained control over the price, the bulls remain largely in control. And as long as the selling pressure remains low, BTC could recover above $31,000 in the coming days.

At the time of writing, BTC is trading just above $30,000, down 1.59% over the past 24 hours. Although it is currently struggling, it has a trading volume above $23.5 billion, indicating significant demand for the digital asset as well.