Bitcoin (BTC/USD) continued its slide, falling below $200 for the first time since mid-January. It hit a low of $198 on Bitstamp, capping a slide of 13% during the past 24 hours.
It has since bounced back above $215. Bitcoin had fallen below $200 on a few occasions during the January volatility, but quickly reemerged above the mark each time. On this occasion, bitcoin spent less than an hour below the mark.
Trading over the next week may give a clue if bitcoin has a genuine aversion to dwelling below $200, or if we’re in for a new era of lows not seen in nearly two years.
Bitcoin has now given up as much as 38% since peaking at $318 only one month ago on Greece fears. Undoubtedly, many traders bought in to what appeared at the time to be the next great rally. Those holding leveraged positions since then have faced margin calls, which were responsible for the flash crash on Bitfinex last week.
The Greece fears rattled global equity markets at the time, but are nothing in comparison with the widespread panic seen over the past week. Driven by concerns of slowing China growth and dragged lower by the deflation of the bubble in Chinese stocks, global stocks have set new milestones for the size and duration of their losses. Ironically, the losses in bitcoin have been comparable with those of several major world indices.
A key indicator that volatile times have returned to bitcoin has been the price of litecoin, which has returned to outpacing its progenitor’s moves to the downside. It hit a low of $2.50, losing 23% during the past 24 hours. The LTC/BTC rate has fallen to 0.0125.