The crypto market fall resumed
An overview of the crypto market to start the week
The weekend respite did not break the two-weeks downtrend in Bitcoin. So far, on Monday, it lost 3.7% to $57.4K. Total crypto market capitalisation is down 2.8% over the last 24 hours to $2.57 trillion, according to CoinMarketCap.
Thanks to neutral dynamics over the weekend, the cryptocurrency Fear and Greed Index stabilised in the middle of the scale, at 50. Among the top performers is AVAX, which has added 37% over the past seven days and is struggling to stay in growth territory amid a general pullback in cryptocurrencies.
The technical picture for Bitcoin is on the bearish side. After Friday's technical rebound, the first cryptocurrency hit resistance at the weekend in the form of the 50-day moving average and the 76.4% retracement level from the September-November rally. Stronger selling from this level suggests a short-term trend reversal and a set-up for a deeper and longer correction.
The first marker of a bear market would be a capitalisation drop under $2.38trn, which is 8% below current levels. For Bitcoin, such a level is near $55k, representing a 20% drop from the peak, a return to the highs of September and 61.8% of the last rising momentum. An overcoming of these levels would signal a further drawdown of 20-30%.
The leading altcoin, Ethereum, received fundamental support from the bulls on Friday, having enjoyed increased buying on the downside to $4000 and the 50-day moving average. This could be an indication that the crypto market remains in a buy the dips pattern.
However, we believe the environment of a strengthening dollar, tighter monetary policy, and a return to normalcy carries serious risks. Some cryptocurrency investors may want to lock in and spend profits from rising cryptocurrency prices. Accelerating inflation and depleting coronavirus incentives, combined with the stalling of the crypto market in recent weeks, encourage consumers to ramp up spending now before prices rise further.
And it could form a trend of selling
currencies among small private investors, of which there are many in the crypto