The valuation of the cryptocurrency market has dropped by more than $9 billion over the past 24 hours, as major cryptocurrencies such as bitcoin, Ethereum, Ripple, Bitcoin Cash, and Cardano declined in the range of 2 to 5 percent.
Yesterday, on June 7, CCN reported that the cryptocurrency market has stabilized to an extent, as both major cryptocurrencies and minor tokens remained in the same region for over a week, struggling to initiate movements on the upside.
Short-term stability in the cryptocurrency market often lead to two outcomes: a significant break to the upside or a slow bleed out to previous support levels. Over the past 24 hours, bitcoin dropped from $7,700 to $7,550, deleting its gains on June 7 and ending its short-term recovery back to $8,800.
If BTC fails to rebound to $7,700 in the upcoming hours, within the next 12 hours maximum, a break below the $7,000 region can be expected. It is likely that BTC falls below $7,000, if a major support level at around $7,400 as seen in the 4-hour chart of BTC below is broken.
The majority of investors including prominent trader Peter Brandt predicted an upside break for BTC throughout this week. But, as CCN emphasized on June 6, predictions on the upside are conditional and based on an assumption that the volume of BTC recovers in the short-term. Throughout the past two weeks, the daily trading volume of BTC has remained relatively low, in comparison to early 2018.
“BTC is setting up for a big move soon. From a pure charting point of view the move could be in either direction. In fact, the burden of truth is on the bulls,” said Brandt on June 7, as BTC seemed to build strong foundation for an upside movement. But, the upside movement ended in the $7,700 region, falling below $7,600 once again.
In the short-term, given the low volume of BTC and Ether, the native cryptocurrency of the Ethereum network, it is likely that BTC falls below the $7,000 mark and altcoins or tokens fall substantially against both the US dollar and BTC.
Most traders agree that BTC will likely initiate a strong rally by the end of the third quarter of 2018, supported by a huge spike in volume and demand. But, in the short-term, investors have to acknowledge the fact that the cryptocurrency market is dealing with a bear cycle, mostly due to the lack of volumes.
Ontology (ONT), Aelf (ELF), 0x (ZRX), and others that have seen an exponential increase in value over the past month have started to struggle against both the US dollar and BTC. If Ether continues to fall influenced by the downward trend of BTC, tokens will likely suffer a larger drop in value than major cryptocurrencies.