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Why is Bitcoin price down today?

Why is Bitcoin price down today?

Bitcoin (BTC) price is currently down due to continuous “congestion” frustrating traders and putting pressure on the market sentiment.

BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

Binance “FUD” drags Bitcoin down

Data from Cointelegraph Markets Pro and TradingView shows that Bitcoin is trading below $28,000 as Wall Street opens on May 8.

The largest cryptocurrency is experiencing a dip in sentiment due to transaction fees reaching their highest levels ever and the mempool becoming almost 98% full.

Market participants believe that mass transactions “spamming” the Bitcoin network are at the root of the problem. However, the situation has been exacerbated by the largest global exchange, Binance, repeatedly halting BTC withdrawals.

Binance attributed the outages to “congestion”, creating a backlog of withdrawals, which worsened the already nervous market sentiment. A subsequent tweet confirmed that the backlog had been cleared.

Despite this, BTC/USD has remained low, with the day’s lows standing at $27,617 at the time of writing, representing a drop of 7.4% compared to the local highs seen over the weekend.

Binance Coin (BNB), the exchange’s in-house token, has also experienced losses of around 2.4%, currently trading at approximately $315.

BNB/USD 1-hour candle chart (Binance). Source: TradingView

Traders, whether supportive or not, have quickly agreed with Binance CEO Changpeng Zhao when he referred to the market reaction to the withdrawal pauses as “FUD”.

Amid an extended downtrend, Bitcoin traders are starting to look for potential targets for a long entry.

The founder and CEO of trading firm Eight, Michaël van de Poppe, set his sights on $27,400 and $26,800, respectively.

Van de Poppe noted that the difference in weekend opening and closing prices had created a “gap” in the Bitcoin futures markets at CME Group, implying that there may now be an uptick to “fill it” in classic style.

BTC/USD annotated chart. Source: Michaël van de Poppe/ Twitter

Popular trader CrypNuevo, on the other hand, is eyeing targets closer to spot.

Meanwhile, Daan Crypto Trades says there’s a “no trade zone on BTC” until there’s a proper break or sweep of either range extreme.

BTC/USD annotated chart. Source: Daan Crypto Trades/ Twitter

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The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Every investment and trading move involves risk, you should conduct your own research when making a decision.