Bitcoin fails to extend Monday's gains, drops below $4000

After rising more than $300 on Monday, bitcoin came under pressure on Tuesday amid revived concerns over China's attempts to ban trading of cryptocurrencies and gave back the majority of its earning with the BTC/USD pair now trading at $3884, losing 5% on the day.

Xinhua, a Chinese news agency, on Tuesday, reported that all bitcoin exchanges in Beijing and Shanghai have been ordered by authorities to submit their plans for stopping their operations by September 20, bringing back the worries over the digital currencies' future in China, which forced bitcoin to record its biggest percentage loss last week.

"BTCC, in the wake of the announcement, posted a series of tweets about user withdrawals, stating that they will be able to get their money out even after the September 20 closure date. In one of those tweets, the exchange suggested that users withdraw their funds as quickly as possible," CoinDesk, highlighted in a recent article.

Technical levels to consider:

The initial resistance for the pair could be seen at $4220 (20-DMA) ahead of $4470 (Sep. 5 high) and $4700 (Sep. 3 high). On the downside, supports align at $3670 (Sep. 18 low), $3240 (100-DMA and $3000 (psychological level).