As a seasoned cryptocurrency analyst with years of experience in navigating the volatile waters of the digital asset market, I must say that the current state of these three coins – Cardano (ADA), Tron (TRX), and Cosmos (ATOM) – presents an intriguing landscape.
In the last 24 hours, the value of significant cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), Solana (SOL), among others, has bounced back from a steep decline that had sent their prices to levels not seen in months due to a market crash. This downturn in the Japanese stock market sparked widespread fear across traditional and cryptocurrency markets.
Over the last seven days, I’ve observed a significant downturn in both Bitcoin (BTC) and Ethereum (ETH). Bitcoin has dipped approximately 17%, while Ethereum has plunged nearly 25%. Notably, this is the steepest decline Ethereum has experienced since 2021. The selling wave in global equity markets seems to have extended its reach to traditional and cryptocurrency markets, driving both towards unexpected lows.
Bloodbath In The Crypto Market
On Monday, Bitcoin (BTC) dipped to levels not seen for several months due to investor panic over a possible economic downturn in the U.S. markets and dismal economic figures. The cryptocurrency fell below $50,000, reaching a low of $49,360 before regaining some ground. This was the first time BTC had dropped below the significant $50,000 threshold since February. Despite this initial drop, the price has rebounded during the current trading session and is now hovering just under the $56,000 mark.
Currently, Ethereum (ETH) experienced its largest dip since 2021, with the selloff intensifying its troubles. The price of ETH failed to surpass $3,500, and the selloff added extra stress to the asset. Market analysts anticipate that this unexpected market downturn might prompt an immediate interest rate reduction by the Federal Reserve in an attempt to halt the slide in the U.S. markets. Such a swift action would underscore the gravity of the situation. Typically, an emergency rate cut is implemented during extraordinary black swan events.
Market volatility, both traditional and cryptocurrency, has reached its peak since the outbreak of COVID-19, causing significant drops in markets such as Japan, South Korea, and Europe. Bank of America analysts suggest that recent job growth figures falling short of expectations indicate a shift in market sentiment, suggesting that risk is now tilted towards inflation over economic growth.
As a crypto investor, I’ve noticed recently that the data indicates a slower growth pace than initially anticipated. There seem to be no significant upcoming data releases or earnings reports within the next few weeks that might alter this trajectory.
Crypto Futures See $1 Billion In Liquidations
In the past day, there was over $1 billion worth of positions being closed in crypto futures as the selling pressure intensified on Sunday and Monday. Data shows that Ethereum (ETH) futures accounted for approximately $340 million in liquidated bets, while Bitcoin (BTC) reached about $420 million. Additionally, futures contracts for Solana (SOL), Dogecoin (DOGE), XRP, and PEPE combined saw around $75 million in liquidations. Liquidation happens when an exchange terminates a trader’s leveraged position because they have lost part or all of their initial deposit due to not meeting the margin requirements for a leveraged trade.
1. The drop in cryptocurrency values occurred for various reasons, such as escalating tension in the Middle East and disappointing financial results from tech companies. On Monday, the decline deepened when the yen reached a seven-month peak following anticipation of additional interest rate increases by the Bank of Japan.
Relief Rally?
Financial experts find themselves pondering whether the current downtrend persists or if we might witness a rebound rally in the market. In a recent article on platform X, prominent analyst Rekt Capital suggested that Bitcoin’s price fluctuations could stretch over approximately two months.
“Bitcoin has dropped back to a potentially low range, and there may be more declines ahead in the short term. At around 110 days post-Halving, Bitcoin is approaching its typical timeframe for significant price movements, which is between 150-160 days after the Halving.”
Analysts such as Alex Kuptsikevich from FXPro predict that Bitcoin might fall to around $42,000 in value.
Bitcoin (BTC) Price Analysis
During the ongoing trading session, Bitcoin (BTC) has seen a significant rebound, climbing more than 8%, currently hovering around $55,900. Nevertheless, if we examine its performance over the past week, BTC has dropped nearly 17%. The digital currency peaked above $70,000 on July 29 but subsequently turned bearish due to insufficient momentum support. On Wednesday, BTC dipped below its 20-day Simple Moving Average (SMA) and the $65,000 mark, reaching a level of $64,671. Sellers tried to drive BTC even lower on Thursday, pushing the price down to a daily low of $62,311. However, their efforts waned, and buyers managed to counteract the selling pressure, causing BTC to record a 0.99% increase and move back above the $65,000 threshold.
On Friday, there was renewed selling pressure causing Bitcoin (BTC) to drop by 5.40% to $61,786, dipping below its 50-day Simple Moving Average (SMA). By Sunday, BTC had lost the $60,000 mark and closed at $58,301 as markets plunged. The following Monday witnessed an unparalleled wave of selling as investors sought refuge in safe assets due to various factors including potential recession fears, escalating Middle East tensions, a gloomier-than-expected economic outlook, and the collapse of the Japanese markets. This turmoil led BTC’s price to plummet significantly, reaching below $50,000 at one point. On Monday, Bitcoin hit its lowest at $49,360, but despite sellers trying to maintain their push, the bulls managed to drive the price back above $50,000.
Initially, Bitcoin fell by 6.91%, reaching a stable point at around $54,274. This price level appears to be fortified by both buyers and sellers near $50,000, suggesting ample liquidity in the market. The bulls are determined to protect this level, aiming to push the price past $55,000 if they can. Conversely, sellers aim to keep Bitcoin below $55,000, potentially leading to another price drop towards $50,000. However, should the bulls manage to maintain Bitcoin’s value above $55,000, it would imply that the markets have dismissed the downward trend.
As a crypto investor, I noticed that the Relative Strength Index (RSI) has dropped into the oversold territory, suggesting a potential short-term rebound could be imminent. However, it’s uncertain whether the bulls will maintain this recovery and push prices higher in the coming days.
Ethereum (ETH) Price Analysis
Ethereum (ETH) has seen a robust rebound, much like Bitcoin and the overall crypto market following an unexpected market crash. Notably, ETFs focused on Ethereum, such as those from BlackRock’s ETHA fund, VanEck’s ETHV, and Fidelity’s FETH, have all experienced inflows totaling $48 million. This surge comes as Ethereum recovers after a steep drop that saw its price dip below $2,200 for the largest crash since 2021, with concerns it might even slip beneath $2,000. Major traders offloaded approximately 130,000 ETH worth around $290 million during this period of decline.
Since July 30th, Ether (ETH) has been experiencing a downtrend, struggling to break through a persistent barrier at $3,500. After closing at $3,319 on Monday, ETH displayed bearish tendencies, and by Friday, its price dipped below $3,000 following a nearly 7% drop. By the end of trading on Friday, ETH was just under $3,000 at $2,987. With the loss of the $3,000 level, attention shifted to potential support at $2,850 – a level that had previously held each test in the past. A 2.79% drop on Saturday pushed ETH down to $2,904, and it fell below the $2,850 mark on Sunday after a 7.41% slide to $2,688.
Selling pressure intensified as markets plummeted on Monday, with ETH falling to a low of $2,128. However, it recovered from this level and settled at $2,421. This still represented a staggering drop of nearly 10%. The current session has seen ETH recover, with the price up by just over 4% at $2,523. The recovery was expected after ETH had slipped into the oversold zone, raising the possibility of buyers entering the market. With bulls buying the dip at lower levels, ETH could find strong support near the $2,000 level. The next target for the bulls must be to keep the price above $2,500. Should they succeed, ETH could attempt to reclaim the $2,850 level.
Solana (SOL) Price Analysis
Solana (SOL) has experienced a significant resurgence among top altcoins, bouncing back from its low of $109 reached on Monday. SOL briefly dipped below its usual trading range during the peak of the selloff on Monday, but demand grew stronger at lower prices. This suggests that buyers are actively taking advantage of price drops and purchasing SOL. Since reaching a high of $194 on July 29, SOL has been in decline. Despite being bearish throughout last week, selling pressure escalated significantly on Friday, causing the price to drop by nearly 9% to $152.66.
Over the weekend, selling pressure persisted, causing Solana (SOL) to dip beneath its 50 and 200-day moving averages on Saturday, closing at $142. On Sunday, SOL tried to rebound over the 200-day moving average, but the buying force waned, allowing sellers to drive the price down to $138. The new trading week started with intense selling pressure across markets, causing SOL to plummet to a low of $109. However, as demand increased, the price soared to $129. Currently, there’s a strong recovery in progress, with SOL rising by nearly 9% and trading at $141. It’s crucial to keep an eye on potential resistance levels at $146 and $151, as these are currently where the 200 and 50-day moving averages reside.
Should SOL surpass $150 and finish the day above that point, it would indicate a substantial decrease in selling activity. On the other hand, if the price gets denied at these heights, buyers might attempt to drive SOL down towards $120 again. If this barrier is broken, SOL could potentially fall as low as $100.
Cardano (ADA) Price Analysis
On Monday, the value of Cardano (ADA) dropped significantly, reaching a low of $0.277, after losing crucial support levels in its descent. Since mid-July, ADA has been on a downward spiral, and bearish sentiments became stronger on Friday as the price declined by 7.38% to $0.364. The weekend started with some volatility on Saturday, as ADA experienced a minor increase, but the price fell again into negative territory on Sunday, dipping below $0.35 following a 5.75% drop and finishing at $0.344. The broader market selloff also affected ADA, causing its value to plummet by 9.30% to $0.312.
On Monday, ADA reached a low of $0.277, but as traders took advantage of the dip, demand for the coin increased, causing its price to rebound above $0.30. Currently, ADA has seen an approximately 6% increase during this trading session, with bulls aiming to push the price over $0.35. The steep sell-off pushed the RSI into the oversold zone, leading to a predicted relief rally. However, it is anticipated that sellers will try to hold the $0.35 level. If ADA manages to surpass $0.35, it may potentially target its 20 and 50-day Simple Moving Averages.
Tron (TRX) Price Analysis
Despite facing significant selling pressure and ending the week mostly in the red, Tron (TRX) experienced less selling than many other altcoins. On Wednesday, TRX dropped below $0.130, and by Friday, it had dipped below its 50-day moving average following a 4% decline, causing the price to fall to $0.123. However, the 200-day moving average acted as a supportive level, enabling TRX to record gains over the weekend despite intense selling pressure. On Saturday, TRX rebounded from the 200-day moving average, increasing by 1.27% to $0.125. An attempt was made on Sunday to push the price above $0.130, but demand weakened near this level, causing buyers to lose momentum. This led to a slight drop in the price to $0.126. Despite this decline, TRX still registered an increase of 1.36%.
As an analyst, I started off the current week observing that the crypto market was in the red. Specifically, TRX experienced a dip of 4.12%, causing its value to drop below the 200-day Simple Moving Average (SMA) and settle at $0.121. Currently, during this session, there’s a modest uptick for TRX as buyers attempt to surpass the 200-day SMA. If successful, TRX might rise above $0.125. However, should it fail to achieve that level, it would suggest persistent selling pressure, potentially leading TRX back towards $0.120.
SEI Price Analysis
SEI has dropped over 32% during the past week, as selling pressure drove the price below $0.30. Despite the drop, the price has steadily recovered during the current session. SEI has mostly been trading in the red since July 22, when it hit a high of $0.417. By the beginning of the previous week, SEI had slipped below the 20 and 50-day SMAs, as bearish sentiment began intensifying. By Friday, SEI lost the $0.30 level, as sellers yanked the price down to $0.279 after a drop of 8.18%.
Over the weekend, SEI maintained a pessimistic stance, experiencing a decline of 4.23% on Saturday and a more substantial drop of 6.46% on Sunday, ending at $0.250. On Monday, it plummeted further below $0.25 after a fall of over 9%, settling at $0.227. Despite sellers pushing SEI to a low of $0.203, demand increased at lower prices, causing the price to rise to $0.227. Currently in the session, SEI is seeing an uptick almost 5% as it attempts to rebound and reach the $0.25 mark again.
Cosmos (ATOM) Price Analysis
On Tuesday, Cosmos (ATOM) dipped below the $6 mark, following a decline that saw it breach the lower boundary of its narrow trading range. The past week has been dominated by bearish sentiment, leading to a 7.12% drop in ATOM’s price by Friday. This decline continued over the weekend, with ATOM falling by 4.37% on Saturday and an additional 1.50% on Sunday, ending the weekend at $5.04.
On Monday, the price dipped even more, reaching a minimum of $4.04 due to increased selling activity throughout the market. As bears struggled at lower prices with demand rising, ATOM concluded the day at $4.65. Currently, there’s a 3.28% increase in the price as buyers aim to push it back above $5. If successful, ATOM might advance towards $5.50 or even $6. But if it fails to regain $5, this suggests that selling pressure remains strong, and the price could potentially fall to $4.50 or lower.
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2024-08-06 14:06