The cryptocurrency market has lost about 60% of the total market-cap in the past one week, with the top two digital tokens — Bitcoin & Ethereum – giving up significant gains from their all-time highs.
The price of Bitcoin, world’s largest cryptocurrency, has recovered to $37,000 from $30,000, its lowest price since January this year. Other coins followed suit, crashing as much as two-third in the past couple of weeks. Reuters reported that this past Friday, both Bitcoin and Ethereum saw their biggest single-day falls since March 2020, when the pandemic began.
“The digital currency market has plummeted from $2.2 trillion to just $1 trillion in the past few days. While social influence, China’s ban on cryptocurrencies and Tesla not accepting Bitcoin as payment any more are the key reasons for this price dip, this short-term volatility as course correction and normal in any volatile market, especially after such a large rally,” said Monark Modi, Founder and CEO, Bitex
As of 9:50 am on May 24, these are the prices of the 10 largest cryptocurrencies by market capitalisation (data from coinmarketcap.com):
- Bitcoin: $35,171.36
- Ethereum: $2,139.29
- Tether: $1.00
- Cardano: $1.35
- Binance Coin: $277.41
- Dogecoin: $0.3065
- XRP: $0.7999
- Internet Computer: $143.44
- Polkadot: $18.33
- USD Coin: $1.00
ZebPay Trade Desk’s Tech View
Bitcoin charts have turned bearish post the recent current correction. However, there are signs of recovery with BTC cooling just close to the long-term bullish trend-line and a fallback close above the $36,000 mark will confirm the end of the correction. Fibonacci Retracements 61.80% at $30,900 which acted as strong support.
BTC might see a pullback relief rally above $36,000, but should face resistance at $42,500. Bullish patterns evolve above the resistance levels of $42,500.
The analytics suggest Bitcoin has been looked at as the most preferred asset among the digital assets in times of uncertainty with volumes shifting to the same and dominance in market cap taking a slow uplift again.
In addition to the above, falling open interest along with the drop in prices is giving a quick indication of a relief rally soon.