In the last 24 hours, the #crypto market has slightly declined by $2 billion in #valuation as the #Bitcoin price fell by one percent.
The decline in the #value of major crypto assets in the likes of Ripple (XRP) and #Ethereum (ETH) which recorded #drops in the range of three to five percent prevented the #market from continue recovering.
From January 30 to January 31, the crypto market seemed to be rebounding as its #valuation rose from $111 billion to $115 #billion. But, in the past 12 hours, the valuation fell back to $112 billion, unable to #sustain its #momentum.
BITCOIN WEAK IN SHORT-TERM, WHERE IS THE #BOTTOM?
Generally, traders #foresee the Bitcoin price declining to the low $3,000 region in the near #future if it fails to demonstrate a strong #recovery above mid-$3,500.
Cred, a #cryptocurrency technical analyst and trader, said:
Low time frame breakout and pullback into support. However, don’t lose sight of the bigger picture: #bearish bias as long as price is below $3,513, which is a high time frame #level.
Similarly, Luke #Martin, a cryptocurrency analyst, noted that the price trend of #Bitcoin is not showing any momentum or #signs of a trend reversal, which may lead the #asset to drop to the low $3,000 region and even to the mid-$2,000 #region.
As #Bitcoin started to fall again following a steep sell-off on January 29, major crypto #assets which performed well against both #BTC and the U.S. dollar began to record large #losses.
#Ethereum has fallen back to the low $100 region and is at risk of declining below the $100 mark. #Ripple fell four #percent on the day to $0.3, eyeing a drop to $0.25.
Previously, a #cryptocurrency trader DonAlt suggested that the bottom of #Bitcoin is yet to be established and it could engage in a substantial #drop in the short-term.
On January 29, after #BTC and the rest of the crypto market endured a large drop in value, the #analyst said that the #inability of BTC to recover beyond key resistance levels could lead it to the $2,000 to $3,000 range.
The analyst added:
“Sitting in the last buy zone before new lows. Cut some of my #buys due to the breach of the top of the #zone. Looking to re-add them if it is reclaimed. If green fails I expect a quick move into the $2,000s. If it holds $4,000 is on the #cards.”
As reported on February 1, major #cryptocurrency exchanges are experiencing #difficulties with liquidity #issues, possibly due to the lack of trading activity in the global crypto market.
#QuadrigaCX, one of Canada’s largest crypto trading platforms, publicly said that it is working to #address its #liquidity issues by locating its cold wallets but the firm has not found much success in doing so.
The exchange said:
“For the past weeks, we have worked #extensively to #address our liquidity issues, which include attempting to locate and secure our very significant #cryptocurrency reserves held in cold wallets, and that are required to satisfy customer #cryptocurrency balances on #deposit, as well as sourcing a financial #institution to accept the #bank drafts that are to be transferred to us. Unfortunately, these efforts have not been successful. Further updates will be issued after the hearing.”
Several #analysts suggested earlier this week that as the crypto winter intensifies, #exchanges will run into serious #problems and shutdown.
RECOVERY WILL BE DIFFICULT
In some areas such as #development and regulation, the #cryptocurrency sector is performing better than before.
But, with #exchanges struggling and major crypto assets finding it difficult to stay above crucial #support levels, the #cryptocurrency market is expected to suffer more #bloodbath in the short-term.
Bitcoin declining with low #liquidity and low volume may mean that it is free falling without sell-pressure and as such, it is important for #BTC to hold the $3,300 to $3,400 range.
Featured Image from Shutterstock. Price Charts from TradingView.