Bitcoin (BTC) has been seeing significant momentum in previous weeks equally its price was approaching the precious $20,000 all-time loftier. However, an abrupt end came to this glorious rally, with Bitcoin cost crashing severely over the by 24 hours.

Cryptocurrency market, ane-twenty-four hour period performance. Source: Coin360

While nearly investors were jubilant a potential new all-time high, the price of Bitcoin dropped from $19,500 to $sixteen,300, a drop of 15% in less than 24 hours. The majority of the crypto markets besides followed suit with alts in the deep reddish across the board on Nov. 26.

Bitcoin loses crucial level for support and drops heavily

BTC/USD ane-hour chart. Source: TradingView

The crucial area to hold between $18,400 and $18,700 was lost. This area was vital as back up due to several reasons. The first one is the immediate failure of the uptrend.

If Bitcoin's price dropped beneath this support level, it ways that the uptrend of flipping every previous resistance to support failed.

As the chart shows, the breakdown acquired a down chain reaction. This is the 2nd reason, as losing that level triggered many terminate/losses fueling the drop.

Previously, many traders probable anticipated a further up-motion, every bit the funding rates were favorable on most exchanges. This breakdown and the imminent concatenation reaction of stop/loss triggers are a typical outcome of a trend reversal.

Indeed, information technology'due south quite common that market corrections don't happen in a smoothen manner. They are oftentimes vertical and painful. Staircase up, elevator down.

Total market cap likely to correct to $400 billion

Total market capitalization ane-week chart. Source: TradingView

The weekly chart of the total cryptocurrency market capitalization oft shows a much clearer perspective.

In this manner, the total market cap reached the 1.618 Fibonacci level, where it hit resistance, similar to the $600 billion range.

More importantly, the full marketplace cap established a new higher loftier and broke higher up the previous resistance zone at $400 billion.

This breakout above $400 billion was the starting time breakout in more than two years, as this level served as a difficult hurdle for the past few years.

Therefore, a correction back to this resistance level to confirm as new support should be almost expected and certainly salubrious at the start of a new balderdash bike.

More importantly, a correction toward this level would also line up with the 0.35–0.382 Fibonacci region, which is ofttimes used by traders and investors to look for a potential entry.

What are the levels to scout for Bitcoin?

BTC/USD three-hour chart. Source: TradingView

The Bitcoin price chart shows a breakup below the $18,500–$18,800 expanse and that's immediately the nigh important resistance to pause if the marketplace is to turn bullish again.

Regardless, the region between $15,800 and $16,300 is a crucial support zone to concur and is currently holding as i on the daily timeframe.

In that light, a new range is established. As long equally Bitcoin sustains support above $xv,800–$sixteen,300, the balderdash market is probable to resume.

Notwithstanding, if it fails to concur support, a further correction toward $13,800–$14,200 should exist expected adjacent. This level is the summer 2019 high, where the side by side bullish support/resistance flip can occur.

On the higher timeframes, $18,000–$xviii,200 is the commencement clear hurdle to break, as that was the level the price of Bitcoin failed to break earlier today on the rebound. If that breaks, the next area to lookout is $18,400–$18,800, at which today's downwardly chain reaction began.

The views and opinions expressed hither are solely those of the writer and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves adventure. You should behave your own research when making a conclusion.