When Can We Expect the Crypto Market to Recover
Recent developments in the cryptocurrency market have intensified concerns, with ongoing repayments from Mt.Gox creditors adding to the prevailing pessimism. The sell-off pressure, notably from Bitcoin miners and large holders, has contributed to a significant downturn. According to Glassnode’s on-chain data, over 21,000 Bitcoins, valued at more than $1.2 billion, were transferred to exchanges over the past week.
Additionally, recent on-chain data reveals that several prominent Bitcoin and Ethereum whales, who had leveraged loans on decentralized applications (Dapps), faced liquidation within the last 24 hours. This coincided with a substantial $636 million liquidation from crypto derivatives trading, primarily impacting long positions. Coinpedia’s latest report indicates a notable decline in market sentiment, with the fear and greed index dropping from a neutral 44 to a fearful 29 in just 24 hours.
Looking ahead, Mt.Gox is set to continue its distribution of cryptocurrencies over the next quarter amidst ongoing Bitcoin sales by governments in Germany and the United States. This scenario echoes a significant market capitulation akin to the FTX collapse. From a technical viewpoint, Bitcoin’s ability to reclaim $56,000 as a support level will be crucial. Failure to do so could see the price stabilize around $52,500 in the short term.
Speculation looms regarding the conclusion of the macro crypto bull cycle. Although concerns of a cycle peak in 2024 persist, historical precedents suggest that major bull cycles endure despite intermittent corrections. Analysts draw parallels with the 2017 cycle, marked by multiple 25-30% pullbacks before reaching a peak near $20,000.
Meanwhile, Matrixport anticipates renewed bullish momentum heading towards the U.S. general election, buoyed by potential interest rate cuts. Furthermore, correlations with major stock indices, such as the S&P 500 hitting record highs, hint at broader market influences shaping crypto’s trajectory.
For further insights into the ongoing crypto market trends and price analysis, stay updated with the latest developments.