Something unique happened to both Ethereum (ETH) and Tron (TRX) this morning at around 3:54 am (UTC). Both these cryptocurrencies started dipping and continued on a downward spiral for close to two hours as shall be explained.
Ethereum, at the said time of 3:54 am (UTC) was valued at $575.96. Two hours later at 5:59 am (UTC), the King of Smart Contracts was valued at $524.51. This is a drop of 8.93% in the said time period. Ethereum has since somewhat recovered and is currently trading at $537.75 at the moment of writing this.
Analyzing Tron (TRX) during the same time period, indicates that the token was valued at $0.07047 at 3:54 am (UTC). Checking the price once again at 5:59 am (UTC) on coinmarketcap.com, we find that TRX had dropped by 9.33% to a value of $0.0639. TRX is currently trading at $0.0655 at the moment of writing this.
So what exactly is going on?
Firstly, the crypto market is in a bearish trend with the King of Crypto, Bitcoin (BTC), unable to maintain levels above $7,500. BTC is currently trading at $7,237 with some experts predicting that it will drop further to $5,700 before things start getting better. Willy Woo is the analyst who has made this observation and cites the following four reasons as to why BTC will keep dropping as well as our favorite alternative cryptocurrencies.
- High NVT signal
- High volatility
- Standard NVT overly high
- Volume Profile cliff below $6,800
Mr. Woo is quoted as saying the following with respect to the NVT (Network Value to Transaction) signal
NVT Signal is still too high. We need more blockchain transactional activity to justify the current price, or the price to drop to reconcile the difference. To drive up transactional activity in a bear slide is very unlikely. Volatility is still too high. I’m looking for a sustained low band of volatility which tends to be a signal for the end of the detox and the next accumulation phase. It’s still got some time to ride down
More on how to calculate the NVT can be found on WooBull.com.
Secondly, the is also speculation that the current market decline of Bitcoin is as a result of market manipulation that was catalyzed by the Bitcoin Futures being offered by the CME Group and CBOE back in December.
Both theories might hold some water as the market continues to dip. One can only HODL, cash out or decide on a suitable entry point to get more crypto in the markets.