A swift drop in the price of Bitcoin has led to panic selling and news-fueled frenzy on the cryptocurrency market. One tweet from prominent crypto analyst Altcoin Gordon was enough to get this response. He pointed to an unprecedented price collapse and discussed major market indicators. The tweet, sent at 10:32 AM UTC, quickly gained traction and ignited discussions among traders and investors.
Altcoin Gordon's tweet included a chart illustrating a sharp decline in Bitcoin's value. It already dropped from $75,000 to $68,000 in just the last 24 hours. This 9.3% crash has started a domino effect throughout the altcoin market. Consequently, countless investors are completely rethinking what they own and how the world is going to look moving forward.
The sharp decrease in price came as the cryptocurrency market saw significant increase in trading activity. Bitcoin’s trade volume surged by over 30% to over $50 billion suggesting strong selling pressure. The last analysis of that volume profile on the 1-hour chart indicated that the biggest volume bar was located directly at that $68,000 price point. This result makes the case that there is considerable opposition at this stage even stronger.
Deeper technical analysis uncovers more contributors that have the market feeling bearish. The Relative Strength Index (RSI) for Bitcoin tanked from 72 to 38 for the same period. This change represents a move from overbought to perhaps even oversold territory, indicating a potential shift in momentum.
Bitcoin’s 50-day moving average, currently at the $70,000 mark, has served as a strong resistance barrier since then, making a quick recovery extremely difficult. This technical barrier introduces a new layer of concern for investors eyeing quick rebounds. The Moving Average Convergence Divergence (MACD) for BTC similarly had a bearish crossover on the 1-hour chart. This occurred at 10:45 AM UTC when the MACD line crossed below the signal line, further confirming the negative trend.
On-chain metrics are a very useful complementary tool to gauge how the market is behaving. Further negative signs are pointed out, including a 10% reduction in the number of active addresses on the Bitcoin network, depicting the existing bearish sentiment of the investors. This drop indicates a lowered willingness to participate and confidence in the short term outlook of the market.
Ethereum, the second-largest cryptocurrency by market cap, had some significant changes in its on-chain data. Transactions leading to losses jumped by 15%. It’s true, 70% of all transactions in the past 24 hours have been at a loss. This information further highlights the pernicious effects of Bitcoin’s roll to the rest of the cryptocurrency market.
This abrupt price drop has caused investors—both retail and institutional—to exercise extreme caution. Some are now waiting to see how the market shakes out, watching key market indicators closely and reevaluating their own risk exposure. The increased trading volume suggests that some investors are liquidating their positions to cut losses or secure profits, while others may be waiting on the sidelines for more stable conditions.
Though no one can say for sure, market analysts have offered a few possible explanations for what’s going on. These factors range from macroeconomic headwinds, regulatory uncertainties, and profit-taking activities amid Bitcoin’s recent surge. This perfect storm has created the most jittery market thus far, more sensitive to bad news and falling prices.
