The crypto market has dropped a lot over the past few days. At the time of writing, the total value of all cryptocurrencies has dipped by $32 billion in the last 24 hours and now sits at $3.81 trillion. Now, the market is reacting to a support level, but if the selling pressure continues, it could fall deeper to $3.73 trillion.
Bitcoin Drops Below $113k
Bitcoin drops down to $112k which is a modest 0.40% in the last 24 hours. This is as a result of its decrease in trading activity which has dropped by 12.45% from previous day, leading to $49.57 billion in volume.
If the drop continues, the price could reach $110,000 which is a support level that price could react to. However, the Relative Strength Index (RSI) is below 5, which means the bears are stronger than the bull at the moment.
Meanwhile, if the price could manage to get back above $113,000, it could surge back to $115,000 and from there gain enough momentum to $120k.
Altcoin Market Follows with Modest Drips
Ethereum fell 8.5% over the weekend, losing $46.4 billion in value. Dogecoin dropped 13.5% and Solana went down 11%. In addition to that, the altcoin IP had the biggest single-day loss, falling 12% to $11.86, just above its support at $11.82. If it drops below this, it could fall to $10.48. But if it bounces back, it might reach $13.60.
What Causes the Fall?
The recent fall happened for a few reasons. Many investors sold their coins to take profits after making gains in recent months. Meanwhile, last Thursday, the news of lower Federal interest rates briefly pushed crypto prices up, but some traders sold quickly because they thought the gains might not last. This caused many margin calls, where investors using borrowed money had to sell their coins. According to data from Coinglass this forced sales almost hit a five-year record and affected many cryptocurrencies.
Moreover, crypto prices often follow four-year cycles connected to Bitcoin halving events. The current cycle started in April 2024. In the past, after halving events, Bitcoin and other cryptocurrencies rose for a time and then fell before the next halving.
For example, after the 2016 halving, Bitcoin went from $660 to $17,760 before falling again. According to experts, history can give hints, but events like pandemics or big economic changes can affect prices.
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