BTC market cap drops below $ 600 billion
The world’s most valuable digital asset has lost about 6% of its value in the past 48 hours, with its total market cap falling below $ 600 billion.
At $ 30,500, Bitcoin is currently trading near its lowest level since June 26, 2021
The total market capitalization of digital currencies hit a low of $ 1.27 trillion on Monday after the recent Bitcoin and Ethereum sell-offs. ETH remained the worst performing cryptocurrency in the top 5 over the past 48 hours.
Ethereum is now down around 10% over the same timeframe.
The rule is simple – Bitcoin leads and Altcoins (including Ethereum) follow with higher volatility. At this point in time, there is no reason to expect this rule to change.
The crowded trade
Bitcoin futures funding rates have been hit negative in this seemingly endless sideways range. This means that many derivatives traders are confident that prices will fall.
According to the data above, BTC / USD has continued to hover within the lower limit of nearly $ 30,000. Historically, there has rarely been a point where month-long bear markets and negative funding rates have resolved to the downside. The same could be said for the opposite situation.
In fact, the crowd is often wrong on short-term moves, but correct over a long time horizon (hence the saying “wisdom of the crowd”).
Could this be such a moment?
Short squeeze loading
As various traders and influencers have noted, BTC / USD closed the week below the 20-week moving average (not to be confused with the exponential MA) – which signals a bearish trend in the weekly timeframe. However, the conclusion was marginal and leaves room for interpretation. As a result, the indicator becomes less important and is available until further confirmation.
Should the range hold, liquidity remains on the upside with $ 33,500 as the first point of interest to the bulls. In this environment, a potential liquidation wick (4 hours) will not be discounted to the 20-month EMA at $ 27,140. From my point of view, given the funding ratio, this scenario is less likely. As mentioned in a previous newsletter, the GBTC unlocking story has been overrated and could not be materialized in a doomsday scenario.
Can Bitcoin bulls make it or will the bear season last for the next few weeks?
We will see.
See you later.
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