Cryptocurrencies Crash Continues; Bitcoin’s Bulletproof Bottom at $6000?The leading cryptocurrencies show a two-digits sell-off on Tuesday: Ethereum (ETH) has lost more than 17%, XRP fell by 14.5%, and Cardano (ADA) has plummeted more than any other major cryptocurrency by almost 20%. Bitcoin dropped 6% to trade near $6000.
The cryptocurrency market has started the current week with an impressive decline. The total market cap fell by 12% to $ 192 billion a day, which is less than 25% of the peak market volume at the beginning of the year. The Bitcoin once again came to the threshold level at $6000 losing more than 6% in the past 24 hours.
The leading altcoins show a two-digits sell-off: Ethereum (ETH) has lost more than 17%, XRP fell by 14.5%, Cardano (ADA) and IOTA (IOT) have plummeted more than any other major cryptocurrency by almost 20%.
As we take a look at the BTC chart for this year, we can see that the cryptocurrency showed lower lows and lower highs until the BTC level reached the current mark somewhat below $6000, which seems a strong support level.
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$6000 mark could become the solid support with possible reverse
From a technical analysis perspective, the situation looks ambiguous. The Bitcoin returned to the area of its lows where it received support in February, March-April, and June. Another rebound from this area could start a significant rally, having established as a bulletproof bottom.
The RSI index also came out of the oversold levels, which often increases the chances for a rebound. Despite the weakness of the market, this scenario looks the most plausible at the moment.
Alternatively, the drawdown lower than the previous levels near $5800 could give an impulse for a new sell-off wave. In this case, BTC would expect a decline to $3300 level due to a significant liquidation of long positions.
Volatility in the traditional markets does not cause the demand for cryptocurrencies, as it was a year ago, despite the twofold increase in trade volumes on the Turkish exchanges. In general, the world becomes a witness of a massive diminishing of the interest in cryptocurrencies.
This article was written by FxPro