Written by: Weizhi, Lucy
In the past 24 hours, the total market value of the crypto market has fallen by $91 billion.
After 12 hours of long-short game at $60,000, Bitcoin began to "fall" at 9 am today, falling below $58,000 for a short time, and once again fell to the low of a week ago, with a 24-hour drop of 5.72%. As of writing, Bitcoin has returned to above $59,100.
In addition to Bitcoin, mainstream altcoins also began to fall. The crypto market was liquidated by nearly $100 million in one hour, accounting for half of the past 12 hours. The mainstream tokens of the Ethereum ecosystem, such as LDO, ETHFI, and ENS, fell between 8% and 20.46% in 24 hours. The Solana ecosystem was not spared, and JTO, WIF, and TNSR all fell by about 15%.
It's at the bottom, but there's always a reason to fall
Although the market downturn has lasted for a month, the crypto community has accepted that the current stage is a "long correction bottom" and Bitcoin volatility is close to its lowest level since February, but signals of continued decline still exist.
“Current cryptocurrency market dynamics are characterized by low volatility, weak trading volumes, and order books that become unbalanced when prices begin to move toward the edge of the range,” David Lawant, head of research at FalconX, wrote in a note.
Bitcoin spot ETF is an important reference for judging market trends. According to Farside Investors data, Bitcoin ETF has experienced net outflows for two consecutive days, with a total outflow amount of US$34.2 million in two days.
In addition, the lack of new funds entering the market is also an important reason why the market is difficult to meet market expectations.
The total market value of stablecoins in the crypto market has been growing steadily since the middle of last year, and the overall market has continued to rise at that time, with obvious signs of a bearish turn to bullish. However, since the beginning of May, there has been no new money entering the crypto market, and the market value of stablecoins has been hovering around $160 billion for more than two months. In the absence of sufficient liquidity in the market, there is no buying power to drive the market up.
Sentiment remains depressed, is it time to buy?
A week ago, Bitcoin hit $58,000. A week later, Bitcoin fell to this level again. Is it a correction or the end of the bull market? The market has different views.
From the technical indicators, the RSI (Relative Strength Index) of Bitcoin on the 4-hour and daily lines has shown a bottom divergence. This means that the price of Bitcoin may have fallen too much in the short term, and today's downward selling pressure is not as strong as on June 24, so there is a possibility of a rebound.
Market sentiment is too pessimistic. Is it time to buy? According to the analysis of crypto KOL Ignas, the price of Bitcoin is being artificially depressed, and the deceptive sell orders of whales are used to induce retail investors and investment managers to sell for risk aversion.
Just yesterday, CryptoQuant released a report stating that for most of the time since the halving, Bitcoin miners have been paid "extremely low" and transaction fee income has dropped to only 3.2% of total daily income, the lowest share in three months. With insufficient incentives, miners will begin to "surrender" one after another, shut down underperforming equipment, and start selling Bitcoin to hedge risks, which historically usually means that Bitcoin will show a bottom signal.
But there are also signs that Bitcoin may continue to fall.
Judging from the net flow of Bitcoin ETFs, Markus Thielen, founder of 10x Research, said in his latest report that the average entry price of Bitcoin ETF buyers is estimated to be $60,000 to $61,000. Therefore, when Bitcoin fell below $60,000 yesterday, it may trigger a wave of ETF liquidations, further lowering the price of Bitcoin.
For example, Markus Thielen believes that Bitcoin's weekly and monthly reversal indicators foreshadow a broader correction, and its price may further correct to $55,000. Andrew Kang, co-founder of crypto venture capital firm Mechanism Capital, sees a lower bottom and believes that Bitcoin may experience an extreme correction to the $40,000 range.
The market remains confident about the long-term price of Bitcoin. Standard Chartered Bank predicts that Bitcoin may hit a record high in August and reach $100,000 by the time of the US presidential election in November. The bank's analysts expect Trump's victory to push up Bitcoin prices, while maintaining the target price of $150,000 and $200,000 for Bitcoin by the end of the year and 2025, respectively. Fundstrat co-founder Tom Lee also insisted on his prediction that Bitcoin will reach $150,000.
"It's too hard to make money" and "I'm sorry for my family" are the common discussions in the community this month. For retail investors, this bull market is really too difficult.
