Bitcoin Has Slipped Under The $58,000 Level In Its Latest Plunge

Contrary to what investors may have hoped, Bitcoin hasn't appeared to have shaken off bearish winds as the asset has witnessed another setback over the weekend.

Bitcoin price dropped below the crucial $58,000 level on Sunday as its latest rally showed signs of running out of steam.

BTC last traded down 2.2% over 24 hours at $57,460, hitting its lowest since mid-August. A subsequent recovery saw the floor price rise to around $57,100. BTC/USD is now up around 65% year-to-date.

A closer look at the BTC price chart reveals a close correlation with the Coinbase Premium Index, an indicator that measures the percentage difference between the Bitcoin price listed on Coinbase (USD pair) and Binance (USDT pair).

When the value of this metric is positive, it means the BTC price listed on Coinbase is higher than on Binance right now. Such a trend suggests the users on Coinbase are participating in a higher amount of buying or a lower amount of selling than the investors using Binance.

On the other hand, the negative indicator suggests Coinbase may be observing a higher selling pressure than Binance since the price on there is currently lower.

Now, the Bitcoin Coinbase Premium Index had been in the positive territory since the crash under $50,000 in early August. This buying push from the Coinbase users may have facilitated the cryptocurrency’s recovery during the period.

In the last few days, however, the indicator has flipped into the negative territory again and with this shift, the asset’s price has registered a decline. Given this trend, it would appear that the change towards selling from buying from the investors on Coinbase may have played at least some sort of role in the latest Bitcoin plunge.

BTC’s price seems to follow the Coinbase Premium Index, which is nothing new for this year, as the cryptocurrency has been closely reacting to movements in the indicator during the last few months.

This may be because Coinbase is the preferred platform of the American institutional investors, so whenever the index changes direction, it suggests these large entities have changed their behavior, which naturally reflects in the coin’s value.