Cryptocurrency downturn persists as bitcoin eyes below $30k

Cryptocurrency prices have been on a steady downswing over the past weeks as overall upward momentum across the board ran out of steam due to huge selloff volumes above key resistance levels.

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 with an up to 30-50% decline over the coming days or weeks.

The key here is that unlike previous days there is no significant dip buying as fears of further declines against the backdrop of the persistent negative outlook continue to fuel caution and broad risk-off sentiment in the market.

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.

As of press time, Bitcoin (BTC) is changing virtual hands at US $35,900, Ether (ETH) at US $2,450, ripple (XRP) at US $0.91, Binance Coin (BNB) US $336, cardano (ADA) at US $1.49, Dogecoin (DOGE) at US $0.30, ChainLink (Link) at US $29.50, UniSwap (UNI) at US $26.78, Polkadot (DOT) at US $21.93 and Stellar (XML) at US $0.39.


On the flip side, if there is an uptick in dip buying, this might create a short term support to hold the market.

However, almost all margin providers have announced temporary margin changes on cryptocurrency instruments due to the soaring short-selling as experienced traders use leverages to get ahead of such pullbacks. This is also among the factors limiting new orders.

Brokers and exchanges usually warn customers about tightened margin rules when they brace for “elevated volatility” in the markets.

Market noise and buzz around joke or doge currencies and their surge with no fundamental reason or logic have discouraged serious investors over the past weeks now as they fear such speculations threaten the global institutionalisation of the serious technology and innovation.

At the moment, the worry is the current downward drift could be just a little taste of what has to come as risk averse corporate investors bank profits and jump off the sinking ship, leaving retail traders holding the bag.

However, with these range-bound ups and downs amid the sustained downtrend, among the lingering questions is the big one: Is this a hiccup or the start of something worse?

 

 

 

 

 

 

Risk Warning: Cryptocurrency is a unregulated virtual notoriously volatile asset with a high level of risk.  Any news, opinions, research, data, or other information contained within this website is provided for news reporting purposes as general market commentary and does not constitute investment or trading advice.