The digital dust has settled and crypto markets are holding just below $130 billion following the largest single day dump of 2019.
The last time this year that crypto markets fell off the digital cliff so quickly was January 10 after a similar mini bull run took market cap to a high of $138 billion. In one quick swoop markets dumped $11 billion before dropping another $5 billion to settle at $122 billion.
This time around $17 billion was shed as markets plunged from $144 billion to $127 billion in a matter of hours. The pattern however has been very similar. The drivers of the recent rally, namely Ethereum and EOS, have taken the biggest hits losing around 15% each overnight. Bitcoin has dropped over 8% and it was likely that BTC catalyzed the rest of the market into the flash crash.
Lessons From The Analysts
A number of prominent technical analysts have been predicting this pullback and correction all week. Bitcoin, being the bellwether for the rest of the market, has been under scrutiny for climbing too fast. The $4,000 resistance zone has been a solid one for the past three months so it stands to reason that a break through this will not come easily.
Since the big dump of late November, Bitcoin has tested and bounced off resistance at $4k no less than five times. This latest pump took BTC to $4,200 briefly on Sunday before it took a dive shedding $400 in an hour or two. The moving averages, especially the 200, have been very influential throughout this bear market and they were yet again recently.
Several of the crypto analysts on twitter have been predicting a prolonged bear market and the more often Bitcoin bounces off resistance levels the more likely they are to be proved right. A few days ago this was posted by a trader going by the name of ‘fil₿fil₿’;
This chart action has been uncannily accurate so it would be pertinent to pay attention to the rest of it which also has a high probability of playing out. Others such as Murad Mahmudov have foretold an even longer winter lasting until Q3 of this year with a possible big dump below $2k for Bitcoin.
The bottom line is that the bear market is nowhere near over so getting hopes up on minor rallies when markets are still down over 80% is futile. The advice being given by many right now is accumulate and hodl and this makes perfect sense given the events in the past 24 hours.