Round numbers tend to be a fixation for Bitcoin chart-watchers, with many keeping their eyes peeled on $20,000 amid the latest swoon. But veterans know to be on the lookout for a more noteworthy one: $19,511.

That’s the high the coin hit during its last bull cycle in 2017, which it reached at the end of that year. Throughout its roughly 12-year trading history, Bitcoin has never dropped below previous cycle peaks, according to Vetle Lunde and Jaran Mellerud at Arcane Research, so a break below it would be momentous. 

“A potential visit below this level could lead to a lot of hodlers capitulating and a wind-down of leverage, making this a very important support level to pay attention to onwards,” the pair wrote in a note, referencing long-term, staunch holders. 

In addition, besides the psychological importance of the level, most of the open interest in Bitcoin options is based on the $20,000 strike price, according to Arcane, “which can contribute to selling pressure in the spot market should the price fall below.”

Eoin Treacy's view

If most option strikes are at $20,000 and most options trade for several thousand dollars, the majority of positions are already underwater. Therefore, stops are being placed on leveraged bets, even as some traders look for entry opportunities.

$19500 is an obvious level where traders looking to bet on the $20,000 level holding would put a stop. There is a short-term oversold condition and the price is also in the region of the 1000-day MA which has offered support in the past. These psychological levels need to hold if the secular trend is still intact.

Ethereum is down from almost $5000 to $1000 since November and is also short-term oversold.