A massive $1 billion liquidation in the cryptocurrency market was the main cause of this sell-off which had a cascading effect and significantly lowered Bitcoin prices. The graph highlights the strong selling pressure that overpowered the market with a notable volume spike. Bitcoin is now in a risky situation and is testing the 100 EMA support level as a result of the abrupt price drop.
Prominent traders on Binance have demonstrated tenacity almost 70% of them are long Bitcoin placing bets on a future surge. The sharp fall and significant liquidation activity however suggest that overall market sentiment is still pessimistic.
This emphasizes the continuous conflict between conventional value stores like gold and Bitcoin. The general state of the market also contributed significantly to Bitcoin’s downfall. Markets are in a panic as a result of Warren Buffett’s decision to sell off stocks including Apple (NASDAQ:AAPL) and retain $277 billion in cash. A perfect storm for Bitcoin has been created by the NASDAQ’s nearly 6.5% decline and the biggest drop in Japanese stocks in over eight years.
Ethereum has not been immune to the recent over $1 billion market-wide liquidation. The large-scale sell-off has increased the downward momentum by setting off a chain reaction of sell orders. The 200 EMA is a major focal point for ETH which is testing important support levels similar to Bitcoin. If this level is broken there may be more drops ahead which could result in even bigger losses.
The selling of ETH by institutional investors has made the markets decline more severely. Large holders appear to be strongly selling as evidenced by the substantial outflows from exchanges shown by the liquidation heatmaps and on-chain data. An important reason for Ethereum’s current drop is this institutional sell-off and the enormous $1 billion liquidation on the market.
Additionally contributing to Ethereum’s collapse are the general state of the market. A ripple effect has been seen throughout the cryptocurrency market as a result of the panic caused by Warren Buffett’s substantial cash holdings and stock sell-offs as well as the NASDAQs 6.5% decline and the biggest decline in Japanese stocks in over eight years.
SHIB’s abilities to recover are in question because of the significant sell-off that brought it to these lows. With SHIB breaking below important support levels the chart clearly illustrates a downtrend. The price decline of 65% since its peak earlier this year is a clear indication of growing difficulties. The fact that the memecoin price is near the crucial support zone of $0.00001 adds to the pressure.
A drop below this barrier may result in additional losses and possibly add another zero to its value which would be a sign of bearishness for investors. The picture painted by on-chain metrics is equally bleak. Around 1.5 trillion has been transacted in the last 24 hours among whales, which doesn’t exceed the regular transacted volume among large wallets, which is an indicator of the lack of buying or selling power.
This article was originally published on U.Today
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