The cryptocurrency market continues to extend losses as the recent recovery failed to keep the upward traction in order to reverse the prevailing overall downtrend that increasingly appears to be a medium to long-term direction.
The latest rebound was indeed a hype-fuelled lift and couldn’t find fundamental support and ran out of steam.
As of press time, among Top-10 Cryptos, Bitcoin (BTC) is changing virtual hands at US $37,400, Ether (ETH) at US $2,280, ripple (XRP) at US $0.82, Binance Coin (BNB) US $345, cardano (ADA) at US $1.42, Dogecoin (DOGE) at US $0.28, ChainLink (Link) at US $22.06, UniSwap (UNI) at US $21, Polkadot (DOT) at US $21.60 and Stellar (XML) at US $0.29.
Amid dwindling market cap of the overall digital currency market and persistent value loss, investors and traders are growing increasingly nervous, especially because of the souring mood and negative outlook that, the fear is, may open up a long-lasting downward spiral, adding to the challenges facing digital asset holders in the market that has lost almost half of its capitalisation since early May.
What worries the traders most is that the current decline could be just a little taste of what has to come as risk averse corporate investors keep banking profits on price recovery and jump off the sinking ship, leaving retail traders holding the bag.
Market noise and buzz around joke or doge currencies and their publicity with no fundamental reason or logic have discouraged serious investors over the past two months now as they fear such speculations threaten the global institutionalisation of the serious technology and innovation.
On the down side, there is time tested support around US $33,500 and at the psychological barrier of US30,000 levels to hold the bitcoin in the short term.
However, it is important to note that the market is drifting towards an interesting but dangerous territory where a constellation of key risk factors such as lack of strong support, bearish sentiment, negative outlook, risk aversion, limited buy orders, subdued market activity, restricted leverage, and low institutional trading on the back of the still intact downtrend may lead to a new flash crash in coming days.
This may open new lows, pushing bitcoin below the US $30,000 level first time in the months. Altcoins would suffer similar percentage-point declines as they have done so far.