Crypto markets experienced renewed selling on Sunday, as bitcoin approached a long-term support that, if breached, threatens to expose new bottoms in the short term. Altcoins and tokens were also on the back foot, as traders piled into dollar-backed stablecoins.
Bitcoin Approaches Critical Level
With the exception of dollar-backed USDT, USD Coin and TrueUSD, all cryptocurrencies in the top-30 traded lower on Sunday. The bitcoin price reached a session low of $3,509.08. It has since recovered at $3,572.64, where it was down 2.5%.
Via Bitstamp, the BTC/USD exchange rate is still seen hovering in the low $3,500 range.
Bitcoin faces critical long-term support near $3,550, and a firm break below this level would likely lead to a further unwinding back down to $3,000. The leading digital currency bottomed just above $3,100 last month before regaining more than a third of its value. Read: Bitcoin Approaches “GTFO” Level.
Bitcoin is likely to experience heavy volatility in the short term as long-dormant crypto accounts become active once again. Over the past 30 days, dormant bitcoin wallets have accounted for about 60% of the circulating supply, a strong sign that large holders were shifting assets to virtual exchanges. A similar influx preceded two major price swings in 2015 and 2017. More on this story: Bitcoin Likely Headed Lower as Whales Activate Long-Dormant Accounts.
Altcoins, Tokens Follow
Where bitcoin goes, altcoins and tokens seem to follow. This gravitational pull has only strengthened during the bear market, eroding what many believed was a broad decoupling between bitcoin and altcoins at the beginning of 2017.
The cryptocurrency market capitalization is down another $4 billion on Sunday, reaching a new three-week low of $118 billion. Trading volumes have plunged over the last seven days. On a 24-hour basis, total market volumes have drifted below $14 billion, according to CoinMarketCap.
Among the top-ten cryptocurrencies, losses ranged between 1.5% and 9.6%. Tron fell by the latter amount, as TRX drifted back toward the low $0.02 range.
Ethereum declined 6.8% to $118.20, the lowest in three weeks. The Ethereum network is scheduled to undergo a highly technical upgrade sometime over the next four days. More on the Constantinople hard fork can be found here.
XRP is currently trading 2.7% lower at $0.3205. Bitcoin cash and EOS are both down more than 6% at $125.88 and $2.28, respectively.
Litecoin’s price fell 4% to $30.96. Bitvoin SV, now the tenth ranked cryptocurrency by market cap, drifted lower by 9% to $75.84.
Beyond the top-ten, Cardano fell 6.2% to $0.0406, Monero declined 3.3% to $43.61 and Dash fell 3.6% to $70.76.
The fallout from the 51% attack on the Ethereum Classic network has been particularly devastating for the ETC price. Ethereum Classic is down another 7.6% to $4.26, where it was ranked 18th by market cap.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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