Total crypto market cap added $180 billion to its value for the period since Monday and now stands at $1.77 trillion. The top ten coins are all in green for the last 24 hours with Polkadot (DOT) and Binance Coin (BNB) leading the pack with a 19 and 12 percent of increase respectively. At the time of writing bitcoin (BTC) is trading at $39,330, ether (ETH) moved up to $2,870.
Bitcoin hit a weekly low of $33,347 on Sunday, May 30, and confirmed the $32,000-$33,000 zone as solid mid-term support. It registered a 3 percent increase on a seven-day basis and avoided further decline to the sub-$30k levels thus keeping the hopes for an upside reversal alive.
It is worth noting that the BTC/USDT pair was extremely volatile, moving up and down the $40,800 – $33,500 zone during the period, which suggested a lack of momentum in any of the price directions.
On Monday, buyers pushed the price above to the important $37,000 horizontal S/R and formed the second consecutive green candle on the daily chart by reaching $37,300. The move resulted in a 4.3 percent growth in value for the leading cryptocurrency.
Bitcoin closed its worst 30-day period since November 2018 dropping 35 percent thanks to a group of fundamental factors impacting the perspectives in front of the bitcoin mining process.
On Tuesday, June 1 BTC hit the upper boundary of the bearish pennant formation on the daily chart at $37,900 and corrected its price down to $36,600 thus losing the local support line once again.
The mid-week session on Wednesday came with a breakout attempt as bulls managed to push the price up to $38,200 and to surpass the mentioned triangle-like formation before retracing to $37,500 at the daily candle close.
The BTC/USDT pair is trading at $39,300 midday on Thursday, well above the previous resistance zone.
The price of the Ethereum Project token ETH continued to strictly follow the technical indicators and trend-defining formations on all timeframes.
On Sunday, May 30 it hit a weekly low of $2,170, touching the lower end of the long-term uptrend corridor. Earlier in the week, the coin touched the meeting point of the horizontal resistance, the 21-day EMA, and the newly formed diagonal line at $2,900, which triggered a 20+ percent selloff.
The ether added 14.4 percent up on a weekly basis, rebounding perfectly from the 21-day EMA on the bigger timeframe.
On Monday, the ETH/USD pair resumed the uptrend rally and reached the $2,700 mark while breaking the $2,500 S/R line. It ended the month of May 2.5 percent lower compared to the previous 30-day period.
On the very next day, the coin made a short retrace, during which the mentioned line was successfully re-tested.
The third day of the workweek was a continuation of the upward movement. The leading altcoin was trading as high as $2,800 but closed the session at $2,700.
The altcoin market is in green midday on Thursday. ETH is hovering around $2,860.
Extreme Fear In Crypto Market, Is It Time To Buy The Blood In Bitcoin?
The past week has been a brutal one for bitcoin and crypto in general. The market has taken hit after hit. So much so that it’s starting to seem like there is no end in sight. Coins have been falling at high percentages. It brings back a popular saying in the financial markets; “there’s blood in the streets.”
Investors have been reacting to this negatively. The Arcane Research Fear & Greed Index has moved back into extreme fear. Going down to the lowest it has ever been this year.
Fear & Greed Index down to 10 into extreme fear | Source: Fear & Greed Index on Arcane Research
The Index currently sits at 10 in extreme fear. This means that investors are scared to put their money in the market. With no more money going into the market, the prices will go down. And we will see even redder charts.
Time To Buy The Blood?
“Buy the dip” is a popular saying in the crypto space. People are encouraged to buy coins when there has been a massive downturn in the price. Quoting this as being the best time to get into the market. But what happens when a dip goes past just being a dip into full-blown bleeding?
With red charts and downward-facing arrows, the market looks like it is bleeding. With massive liquidations going on and not as much faith in the digital assets anymore, the crypto market valuation is down.
Related Reading | Will A Large Spike In Bullish Sentiment Translate To A Bitcoin Rally?
It is always best to buy assets when there is “blood in the streets.” People are wary of the market. Weak hands are pulling out, dragging the price down. And that is when the long-term hodlers come out to play.
There is never any definite way to tell where exactly the market will bottom out. But a good indication is when assets are down so much that people are scared to buy back in. A time where it seems like the coins will never recover and that is the best time to buy.
Is There A Market Recovery On The Horizon?
A trend in the market has usually been massive dips are followed by good recoveries. People buy assets that are down a significant amount in hopes that they will make a profit when it recovers.
Total market capitalization less than 50% ATH | Source: Total Market Cap on TradingView.com
With institutional investors still holding on to their bitcoins, it looks that they still have hope in the market.
MicroStrategy recently bought an additional $500 million worth of bitcoins to add to its growing portfolio. Goldman Sachs had ramped up its bitcoin trading activities by partnering up with Galaxy Capital. All good-faith moves in the market.
But with the hash rate hitting record lows and the number of bitcoin mined in a day dropping, it could be that the market is headed for a » Read more
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In that case, investors might be headed for a long waiting period. As the crypto » Read more
” href=”https://www.newsbtc.com/dictionary/bear/” data-wpel-link=”internal”>bear markets are notorious for being painfully long. Lasting years at a time.
But there is just as much of a chance for recovery as there is for a total » Read more
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It will not be the first time that the market has pulled ahead after massive downturns. A lot of investors see the falling prices as a chance to buy back in. And more money goes back into the market, so does more faith return. Increasing the valuation of the assets.
Bitcoin has fallen below $30k. Less than half its all-time high. A crucial hold point for the asset.
Ethereum has fallen below $2k.
The total market valuation now sits at $1.21 trillion. Less than 50% from its highest market valuation of $2.4 trillion.
Featured image from Cointelegraph, Fear & Greed Index from Arcane Research, crypto chart from TradingView.com
Bitcoin Price Analysis: Following Massive $4000 Rebound, Is BTC Still In Danger?
The Bitcoin rollercoaster continues after the price dropped by a precipitous 14% from today’s high of $33,250 to reach as low as $28,600. After hitting this level, the cryptocurrency quickly rebounded back above $32,000 liquidating a huge amount of long then short positions.
Yesterday, it seemed like the critical support of $31.7K was holding, however, earlier today Bitcoin broke the ascending trend line (started forming on May 19), losing the $30k support, but, as of now, the price bounced back above.
So far, the past 7 days have been a nightmare for Bitcoin, as the primary cryptocurrency touched $41.3K just last Tuesday. Keeping in mind today’s current low of $28.6K, the price dropped over 30%, before slightly recovering. $28,600 is a 5-month low for Bitcoin. The last time it was trading below $30K was during January 2021.
Moving forward, Bitcoin is still in danger, however, two things might light a bit of positiveness on the market:
– The fact that Bitcoin price quickly rebounded over $4k after plunging below $30k shows that there is very strong demand, especially below $30k.
– The consolidation zone between $30k and $42k, which lasted since May 19, is still intact.
Despite the above, the situation is very fragile, as volatility is expected to continue for the next few days at least.
In addition, the bounce allowed Bitcoin to remain inside the descending price channel as shown on the short-term chart below and buyers defended $31,185 support, and the candle did not close beneath it.
BTC Price Support and Resistance Levels to Watch
Key Support Levels: $31,700, $31K, $30,000, $28,600, $27,740.
Key Resistance Levels: $32,465, $33,520, $34,760, $36,440, $37,500.
Looking ahead, the first support now lies at $31,700 (yesterday’s low and the ascending trend-line). This is followed by ~$31k – $31,185 (downside 1.618 Fib Extension), $30,000, and $28,600 (today’s low). Additional support lies at $27,740 (Jan 2021 lows), $26,840 (downside 1.414 Fib Extension), and $25,000.
On the other side, the first resistance lies at $32,465. This is followed by $33,520, $34,760, $36,440 (20-day MA), $37,500, and $39,490 (early-June highs).
The daily RSI is well within the bearish territory and is still not yet oversold. It is starting to push higher, which indicates that the bearish momentum might be easing up a little. Aside from that, a bullish divergence signal has also appeared on the LTF charts, such as the 4-hour’s.
Bitstamp BTC/USD Daily Chart
Bitstamp BTC/USD 4-Hour Chart
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Cryptocurrency charts by TradingView.
Eswar Prasad: BTC Needs to Solve These Three Issues to Be Truly Effective
A professor at Cornell University believes that bitcoin can never accomplish all it has set out to do unless it manages to get past three big hindrances. According to Eswar Prasad, professor of economics at the educational institution, bitcoin still suffers from several flaws that are preventing it from being stronger than many of its altcoin cousins.
Eswar Prasad: BTC Still Has a Way to Go
In an interview, Prasad points to the idea that bitcoin mining is extremely expensive and hazardous to the environment. This is an argument we have heard time and time again over the past few months. Everyone from Kevin O’Leary of “Shark Tank” fame to Elon Musk – the South African entrepreneur behind billion-dollar companies such as SpaceX and Tesla – have said that bitcoin mining is simply too dangerous for Mother Earth to carry on.
As a means of making themselves more appealing than bitcoin, Prasad says that many cryptocurrencies which came after BTC have looked at the currency’s infrastructure and worked to ensure their mining operations are nowhere near as energy driven.
For example, Ethereum has already implemented a new method of mining it is calling “proof of stake,” which is allegedly built to limit the amount of computing power necessary to extract new units from the network. In fact, according to the Ethereum Foundation, the process requires approximately 99 percent less energy than before.
That is going to be much less energy intensive, and it could deliver a lot of the benefits that bitcoin was supposed to deliver. It could also make transactions much cheaper and quicker.
Another issue he says bitcoin needs to solve is its anonymity. Many believe that bitcoin is an anonymous currency, though according to Prasad, this is not entirely true. To prove this, he points to a recent incident in which the Federal Bureau of Investigation (FBI) was able to intercede and prevent a bitcoin-based ransomware attack on the Colonial Pipeline. He says they would not have been able to do this if bitcoin was as anonymous as people claim.
The main idea of bitcoin… was to provide pseudonymity, but it turns out that if you use bitcoin a lot, and especially if you use bitcoin to get any real goods and services, then it becomes possible eventually to link your address or your physical identity to your digital identity.
In the long run, he says that Monero and Zcash are far better alternatives as privacy coins.
Volatility Prevents Its Use as a Currency
Lastly, he claims that bitcoin does not work well as a currency given that it is so volatile. He comments:
So, you could take a bitcoin to a store and one day, get a cup of coffee and another day, with the same bitcoin, be able to treat yourself to a lavish meal. That does not work well for the medium of exchange.