Bitcoin and other major cryptocurrencies have faced intense selling pressure in recent hours. While US stock markets have maintained a relatively strong performance, the weak performance of the cryptocurrency market has become more pronounced.
Bitcoin, after trading sideways just below $90,000, experienced a rapid decline at the start of US trading, falling as low as $86,800 during the day. At the time of writing, the largest cryptocurrency was trading around $87,000, with a loss of over 2% in the last 24 hours.
The sell-off in the market wasn’t limited to Bitcoin. Ethereum fell to around $3,000, while leading altcoins like Solana, BNB, XRP, Dogecoin, and Cardano also saw declines ranging from 2% to 4%. The total cryptocurrency market capitalization also experienced a significant drop during the day.
Bespoke Investment offers a noteworthy assessment of market dynamics. In its analysis of the iShares Bitcoin ETF IBIT, the firm stated that holding the ETF during after-hours yielded a 222% return, while holding it only during intraday trading resulted in a loss of over 40%. This data suggests that gains in Bitcoin largely occurred while US stock markets were closed.
On the technical side, some analysts argue that the current decline may not be permanent. Markets expert Il Capo of Crypto described the pullback as a “bear trap,” expressing his expectation of a strong recovery. According to the analyst, the next critical target for Bitcoin is the $95,000 level. If this level is clearly surpassed, the $100,000 range could come back into focus.
The drop in Bitcoin’s price has also brought about a significant amount of liquidation. The total cryptocurrency market experienced a liquidation of $468 million in the last 24 hours, with $384 million of that coming from long positions.
*This is not investment advice.