Bitcoin price analysis: BTC/USD below $8,000 as optimism proved hard to sustain

Bitcoin slumped below $8,000 threshold on Tuesday following the news that New York Attorney General launched an inquiry Into cryptocurrency exchanges to see how transparent they are and to protect investors from fraud and manipulations. 

Most of the exchanges targeted by  NY Attorney General expressed their desire to cooperate with authorities to improve "transparency, accountability and security" within the industry.

“Bittrex supports building a secure, fully-compliant environment for blockchain that encourages innovation, economic growth, and U.S. leadership in the industry. That is why we are proactively engaged in discussions with regulators regarding how this may be accomplished with thoughtful policy making,” the representative of a Seattle-based Bittrex explained.

While the crypto universe reaction has been muted so far, the downside pressure may increase due to technical factors, as a sustained break below the above said the psychological level is an ominous sign.

Bitcoin price technical picture

BTC/USD is trading at $7,916, below psychological $8,000 and  61.8% Fibo at $8,100.  Hourly 100-EMA and 50-EMA located at $7,980 and $8,090 respectively make it harder for the coin to regain ground. If the bulls fail to get BTC above 61.8% Fibo at $8,100 during the day, the downside may be extended towards 200-EMA (hourly interval) at $7,760 and towards the pivotal $7,500.

BTC/USD, the hourly chart