Bitcoin, the largest and most popular cryptocurrency, has dropped to $24,000, while almost all altcoins, beginning with Ethereum, have been losing value since the weekend.
Ethereum is trading at around $1238, its lowest level in more than 14 months. Solana also has dropped by more than 15% and is now trading around $27.
Today, cryptocurrency markets hit a new low. The global market cap has dropped to $1.02 trillion from $1.10 trillion yesterday, and nearly every top coin is now worth half or less of their all-time highs.
The immediate cause of the crypto crash appears to be a massive sell-off by investors in response to rising inflation fears.
Investors are also continuing to be risk averse, which is reflected in the stock markets.
Bitcoin experienced yet another significant correction, falling to nearly $25,000, its lowest level in more than 5 months. Interestingly, the Dollar Index (DXY) has also reached a six-month high, gaining 2% in the last day alone, causing a drop in the stock and cryptocurrency markets. The BTC trend has broken below the long formed triangle pattern on the daily time frame. A $24,000 immediate and critical support is expected. As Bitcoin entered the oversold zone, the RSI fell below 30.
Meanwhile, Ethereum has fallen by more than 20% in the last week.
Ethereum fell by more than 11% against Bitcoin during the same period, while Bitcoin’s dominance surpassed 48% for the first time in nearly a year.
The ETH-BTC daily chart has broken below the descending channel pattern and dropped below its previous support level of 0.055. The next level of support for ETH-BTC is expected to be 0.038.
Experts believe that the drop in cryptocurrency prices indicates that investors’ risk appetite is waning. They clearly avoid risky assets. With all of its uncertainties and volatility, crypto is regarded as one of the most volatile investment instruments.
Since Friday, the number of crypto liquidations has been high as investors appear to have panicked.
Bitcoin and Ethereum have both dropped by up to 7% and are currently trading at their lowest levels of US$25,000 and US$1,300, respectively. The bearish trend is expected to continue in the coming days.
According to a CoinDesk report, only a small number of altcoins are likely to survive such market movements.
Rising food, gas, and energy prices, on the other hand, are putting tremendous pressure on the crypto market, with Bitcoin and Ether experiencing double-digit losses in the last 24 hours. After the consumer price index reported the highest inflation rate since 1981, financial markets around the world experienced a sharp decline.
Furthermore, the market is expected to remain volatile in the coming weeks, and countries around the world continue to report high inflation figures. The current dip in cryptocurrency prices allows investors to purchase cryptocurrency at 2021 prices, and we anticipate that seasoned investors will take advantage of the opportunity.
The Fed may have to tighten the screws by raising interest rates faster than expected.
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