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Bitcoin has recovered from the intraday low of $7,689, but the upside momentum is nowhere to be seen. At the time of writing, BTC/USD is hovering above $7,900, while $8,000 serves as initial critical resistance. Bitcoin’s market dominance is registered at 63.5% as altcoins are also losing ground rapidly. 

BTC suffers losses amid the sell-off on the global markets

Bitcoin and major altcoins are affected by a major sell-off on the global financial markets. As Russia decline OPEC’s proposal to reduce the output by another 1.5 million barrel, oil experienced 30%-decline, the biggest on history since the Gulf crisis in 1991. The anti-risk sentiments created a domino effect and pushed all risk assets below important support levels. While Bitcoin’s move below $8,000 looks gloomy, cryptocurrency experts suggest that the coin is about to start the recovery and regain some ground as soon as the panic selling calms down. According to the crypto Twitter expert PlanB, the sell-off didn’t affect the stock-to-flow model, which points to a strong Bitcoin price increase after the halving and will reduce miners’ remuneration to $6.25 from current $12.5. This development will produce a deflationary effect amid the global inflationary environment created by central banks and governments.

Macro dominoes are falling to create a chain of negative sentiment, which is, in turn, triggering a sell-off of crypto. Bitcoin has always been subject to short-term sometimes-violent volatility, but today’s drop is nothing we haven’t seen before,  said Jehan Chu, managing partner with blockchain investment and advisory firm Kenetic Capital.

Apart from that, traders point out to a large bullish gap on CME that may be closed once the US traders join the market. If this is the case, BTC will get back above $8,000 and move towards $8,600.

BTC/USD: Technical picture

The RSI on intraday charts stays on the oversold territory. While there are no signs of reversal as of yet, it implies that the price may start a technical correction within a foreseeable future. In this case, the initial resistance is created by psychological $8,000 and followed by $8,700 with SMA50 4-hour located right above this barrier. The next resistance comes at $9,000. A sustainable move above this area will negate the bearish scenario and bring BTC back on the recovery track.

On the downside, a sustainable move below $7,800 will bring $7,689 back in focus. This support created by the intraday low is followed by $7,500 and $7,200. Both barriers are important from the long-term point of view, while the latter one is created by SMA100 weekly.

BTC/USD 4-hour chart