Analysts and experts have described the latest crypto market downtrend as a correction and that a reversal in trends is possible if investors start accumulating crypto once again.
The past few days have seen a dip in the crypto market, with Bitcoin experiencing a decline below $55,000. However, the crypto market downtrend could be just a correction that may last a few days until sentiments reverse. Meanwhile, a few factors could have led to the Bitcoin price drop, which has affected the broader crypto market.
For instance, a defunct crypto exchange has started repayments for the crypto holdings of its users. This could potentially introduce selling pressure on the market as some recipients might choose to liquidate their Bitcoin. Data has pointed to crypto liquidations crossing $600 million, with around $222 million in BTC liquidations in the last 24 hours.
But, short-term price movements don’t necessarily signal a long-term trend. Bitcoin’s price has historically experienced significant fluctuations, with periods of correction followed by renewed growth. At this juncture, BTC is still trading with double-digit returns since the year’s beginning.
As a result, the Bitcoin price drop might be just a temporary correction, which may be followed by a spike in prices. Bitcoin’s inherent scarcity could contribute to its long-term value proposition as demand increases. Moreover, crypto is already an alternate investment choice for global investors, with better returns than most asset classes in recent months.
BTC/USD 1D price chart
Bitcoin is currently trading at around $53,900 on July 5, 2024, with BTC/USD trading lower by a margin of 7.4% in the last 24 hours. Bitcoin’s market cap was trading at around $1.07 trillion in the last 24 hours.
BTC/USD is trading lower than its 20-day EMA (63,170.77), as BTC’s 24-hour volume was at around $52.24 billion. The global crypto market cap decreased by around 8.01%, trading above $1.98 trillion. BTC’s year-to-date returns are at 29.21%.
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