Cryptocurrencies across the market have seen huge declines. However, investor sentiment sees this move as consolidation, not surrender.
The global crypto market has turned red today as nearly all cryptocurrencies are lost. Globally, assets lost just 6%, bringing the global market value below $ 950 billion.
The biggest losers were Ethereum around 8%, Chainlink 8.2%, and DeFi project Synthetix, down 12.2%. In fact, each project was below Uniswap, which continued its impressive growth with a 1.3% gain. Considering that all other projects in the top 20 have lost value, the situation does not seem bad.
General situation in Crypto Markets
The enthusiasm at the beginning of January seems to have led to a more thoughtful approach to investment. The Fear and Greed Index, which was around 90 at the beginning of the month, dropped to the 70’s as investor confidence decreased.
But one person’s loss is another’s opportunity to buy low-value Bitcoin. As the sensitivity gets worse, technical indicators show there is an opportunity to buy.
In the stochastic indicator, BTC / USD is just above the oversold position. The same can be said when looking at the Williams% R and Bollinger Bands charts, according to analysis site Market Milk.
Indeed, the decline in Bitcoin and asset prices is unlikely to continue more generally as investors will have to lose their assets, according to a report by data collector site Glassnode.
According to Bitcoin’s aSOPR (Ratio of Output Profit) – a measure of the rate of profit when assets last moved in the chain – BTC is now returning to a more established rhythm.
“In order for the SOPR to fall, investors must be willing to sell at an unlikely loss given the current shape of the market,” the report says.
Bitcoin is still considered an investment asset, according to Glassnode’s Net Unrealized Profit / Loss chart, which is its version of the Fear and Greed Index. The withdrawal from the $ 40,000 is viewed as a consolidation rather than a surrender.
So, while today is bad news for day traders, the outlook looks like “another day of opportunity in the crypto world.”
S&P and Nasdaq set new records
Yesterday Wall Street had a double downside, as both the S&P 500 and Nasdaq reached record closing peaks at the end of the regular session.
Technology stocks led the rally, with positive earnings reports expected from technology giants Apple and Facebook. Tim Cook’s Apple rose 2.7% yesterday, Facebook 1.28%, Microsoft and Google also rose. Yesterday’s best performance was Tesla, which gained 4.12% in daily transactions.
Also, there is a wider positive mood in the markets regarding the $ 1.9 trillion financial incentive expected to pass through the Biden White House. Biden allowed further discussion about the size and scope of the recovery package. As it plans to unite the Senate, reports are emerging that the bill will likely be delayed until mid-March. However, the outlook is still a difficult year for the US economy.