Ethereum
Led by Bitcoin, Ethereum, here’s why the crypto market is down today
- The cryptocurrency market is today down due to a significant correction phase.
- Bitcoin is struggling around the $56,000 support level, with technical indicators suggesting a potential reversal.
Checking the crypto market today, you will only see red. The entire market appears to have collapsed, with Bitcoin [BTC] And Ethereum [ETH] taking most of the hits, falling well below their critical support levels.
Bullish sentiments within the community appear to have almost completely disappeared. Once again, investors are panicking, perhaps on the verge of giving up. So what’s up? Why is the crypto market down now?
2024 is widely expected to be a very bullish year for the markets. And that’s the case. But we are currently facing a strong case of corrections.
Data from Coinglass shows us that both tokens have seen more inflows than outflows over the past twenty-four hours. Additionally, liquidations are relatively low.
On May 10, US banking titans JPMorgan and Wells Fargo made headlines by revealing that they held spot Bitcoin ETFs.
Yet this revelation had little effect on overall market dynamics. Bitcoin, for example, appears stuck in a prolonged correction cycle, stubbornly testing investors’ patience.
Source: Coinglass
Why is the crypto market in trouble?
The immediate support level for BTC now lies around $56,000 for traders. Escape is still imminent, as the community widely expects.
Data from TradingView tells us that this is where fear and optimism collide, where traders oscillate between hoping for a breakout and fearing further decline.
Bitcoin is retesting its old record resistance levels, now in the form of new support zones.
This activity shows a typical case of bullish RSI divergence on the 4-hour chart, hinting that the downtrend momentum is running out of steam and could soon reverse.
Yet the currency continues to navigate the perilous downtrend – a technical indicator suggesting that even though the end of the tunnel is near, the road ahead remains fraught with fear and uncertainty.
The community consensus is leaning toward an eventual breakout, which could propel Bitcoin’s value to new highs, potentially reaching $78,000 during upcoming bullish surges.
Source: TradingView
As for Ethereum, its current trajectory is slightly different from that of Bitcoin. Ethereum derivatives market shows signs of increased activity and investor interest, according to Glass knot.
Open interest jumped 50%, indicating strong engagement with Ethereum’s financial products.
However, despite these positive indicators on derivatives, Ethereum’s performance relative to Bitcoin this cycle is much slower.
The delay in speculative interest, particularly from the Short-Term Holder group, demonstrates a cautious approach on the part of these investors.
Meanwhile, long-term holders seem stay on the sidelines, eyeing more lucrative profit-taking opportunities in future rallies.
Source: Glassnode
At press time, Ethereum was worth $2,897.
Read Bitcoin [BTC] Price prediction 2024-25
Even as the company struggles with the current market downturn, growing interest in its derivatives products suggests that these holders could soon benefit from the favorable terms they have been waiting for.
Overall, the reason for this decline is that the market is still consolidating and experts are still expecting a breakout. Investors are advised not to give up. 2024 is still the year of crypto.
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