A miserable weekend has left bitcoin’s price (BTC/USD) testing $260, its lowest point since July 5.
Like in previous drops, traders punished bitcoin as soon as it breached its support level, this time $275. It plummeted as much as 6.5% in less than 24 hours, hitting $260.40 on Bitstamp. It was the largest drop since July 13, when it fell sharply after a deal to bail out Greece put an end to speculative buying that had sent prices to $318.
Bitcoin is currently trading at $265 on average volume.
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Significantly, bitcoin is now back below its 50-day moving average (MA) by 1.9%, its first time trading below the mark in nearly two months. The average had gotten a boost from consistent trade in the upper $200s for a lengthy stretch.
Last year’s August was one of the most volatile periods in 2014 and also saw bitcoin’s divergence from the MA. The latest move may be interpreted by traders as a sign of more volatility to come.
Possibly exasperating the drop was news that major bitcoin exchanges Kraken and Bitfinex will cease services in New York State, citing the difficulty in meeting the Bitlicense requirements, which recently came into effect.
Litecoin (LTC/USD) fell as low as $3.72, its lowest level since July 24. It too fell below its 50-day MA. It is currently trading at $3.89. With bitcoin and litecoin moving by roughly equal proportions, the LTC/BTC rate is holding near 0.015.