Cryptocurrency markets experienced a significant downturn at the beginning of the week, with Bitcoin (BTC) leading the slide after failing to maintain its position above the $100,000 threshold. The flagship cryptocurrency saw a 2% decrease from its briefly achieved six-figure landmark, triggering a broader market correction.
Major cryptocurrencies felt the impact, with XRP, Dogecoin (DOGE), and Solana’s SOL each dropping by as much as 5.5%. BNB Chain’s BNB and Ether (ETH) also saw declines, each down 2.5%, while Cardano’s ADA suffered a 7% drop, worsened by a recent security breach involving the Cardano Foundation’s X account.
The CoinDesk 20 (CD20), which tracks the performance of the largest tokens by market cap, fell by 3.6%. The ripple effect was felt more intensely among midcap tokens, with some losing up to 10% according to CoinGecko data.
The market’s downturn resulted in over $300 million in bullish bets being liquidated. Futures associated with smaller altcoins and meme tokens were hit particularly hard, with the largest single liquidation being a Dogecoin futures trade on Binance, amounting to $5.53 million.
In the midst of this market correction, Singapore-based QCP Capital provided insights into what might lie ahead. In a Monday Telegram broadcast, they indicated a “structurally bullish” stance but warned that the spot market could remain rangebound until 2025. They highlighted historical trends where Ethereum does not typically reach new all-time highs until January following a Bitcoin halving year, a pattern seemingly confirmed by current options market data.
Alex Kuptsikevich, Chief Market Analyst at FxPro, commented on Bitcoin’s inability to stay above $100,000, suggesting it’s dampening investor enthusiasm across the board. He described Bitcoin’s current trading just below $99,000 as a necessary correction that could set the stage for a more robust upward movement. “Bitcoin’s lull is an important position correction that will help the market shake off short-term overbought conditions and move more reliably higher,” Kuptsikevich noted, while hinting at potential growth to the $120,000 level based on Fibonacci extensions.
As the crypto market navigates these turbulent waters, investors and traders are keeping a close eye on Bitcoin’s ability to reclaim and hold above significant psychological levels, which could signal the next phase of the bull market. However, with the holiday season approaching and historical data suggesting a pause in significant price action, market participants might brace for a period of consolidation before any further substantial movements.