The crypto market is melting before our eyes

The crypto market's capitalisation has fallen 2.8% in the last 24 hours to $2.166 trillion. Methodical pressure on the significant coins persists along with wary trading in traditional equity markets.

The bitcoin price has been losing 2.5% in the last 24 hours and is 5.6% lower than it was exactly a week ago. Ether is down 3.4% and 4%, respectively.

Some other top coins are also under severe pressure, but we cannot say that the dynamics are unambiguous. For example, XRP is up 5.5%, AVAX is up 22%, and Luna is up 30.7% in the last seven days.

At the beginning of the year, institutional and investment bank interest provided cryptocurrencies with overperformance but now lowered demand for safety is becoming their Achilles' heel.

The most methodical, albeit relatively measured, pressure has been seen in Bitcoin and Ether, which have been under bearish control for the past month and a half.

According to equity and commodity market definitions, BTCUSD and ETHUSD have crossed the bear market Bear Market A bear market is defined as a financial market in which prices are falling or are expected to decline. This designation is most commonly used in the stock market, though can also be applied to other markets as well, including real estate, foreign exchange, commodities, etc.A bear market differs from periodic declines in assets by virtue of its duration, not frequency. For example, a bear market will typically see extended periods during which large numbers of stock share prices are falling over A bear market is defined as a financial market in which prices are falling or are expected to decline. This designation is most commonly used in the stock market, though can also be applied to other markets as well, including real estate, foreign exchange, commodities, etc.A bear market differs from periodic declines in assets by virtue of its duration, not frequency. For example, a bear market will typically see extended periods during which large numbers of stock share prices are falling over Read this Term threshold, having lost more than 20% of their peaks in early November. Bitcoin, meanwhile, is not gaining meaningful support on the decline towards the 200-day average. These are all signs that the bear market is entering its rights, as enthusiasts can no longer buy out any drawdowns.

Generally speaking, a modest downside amplitude is not typical of cryptocurrencies, so short-term traders should be prepared for an explosion of volatility on a decline below meaningful levels.

We assume that crucial support is concentrated near $40K for Bitcoin, a resistance level in January and a support level in October. Falling below this level could dramatically increase the coin's volatility Volatility In terms of trading, volatility refers to the amount of change in the rate of an index or asset, such as forex, commodities, stocks, over a given time period. Trading volatility can be a means of describing an instrument’s fluctuation. For example, a highly volatile stock equates to large fluctuations in price, whereas a low volatile stock equates to tepid fluctuations in price. Overall, volatility is an important statistical indicator used by many parties, including financial traders, analysts, In terms of trading, volatility refers to the amount of change in the rate of an index or asset, such as forex, commodities, stocks, over a given time period. Trading volatility can be a means of describing an instrument’s fluctuation. For example, a highly volatile stock equates to large fluctuations in price, whereas a low volatile stock equates to tepid fluctuations in price. Overall, volatility is an important statistical indicator used by many parties, including financial traders, analysts, Read this Term and affect the entire market.

For Ether, relatively measured volatility could continue up to the level of the 200-day moving average (just above 3300), which coincides with the area of extended consolidation in August and September and the start of the latest rally in October.

Suppose Ether and Bitcoin fail to find strong buying below these levels as well. In that case, we risk seeing a true capitulation of the entire cryptocurrency market and a revision of the outlook to a more bearish one.

This article was written by FxPro’s Senior Market Analyst Alex Kuptsikevich