Day traders surfing the volatility of the cryptocurrency space were hit hard by a plummeting Bitcoin price on Thursday. The crown jewel of the asset class was down more than 8% over a 24-hour period, dipping below the $9.5k mark — the lowest in about a month. It has remained there since with occasional short-term fluctuations.
Despite the temporary setback, many traders remain optimistic that Bitcoin will regain its lost momentum in the coming days, if not hours. However, things look a lot bleaker comparatively for altcoins. Especially considering that money continued to leave the space even when Bitcoin was faring well.
That, coupled with Bitcoin now languishing in the sub-$10k range, has raised questions on the cryptocurrency side of Twitter as to whether we’re currently staring at another bear market.
However, the possibility of Bitcoin entering a bear market has not stopped many investors from selling off their altcoin stashes (at significant losses) in favor of Bitcoin.
Altcoins Never Left the Bear Market
Whether or not Bitcoin will get back into the $10,000s and take it from there on an upward trajectory remains to be seen. However, there is hardly any doubt that altcoins never stopped feeling the brunt of the bears with nearly all of the major assets shedding value considerably faster than Bitcoin.
Ethereum, the second-largest digital currency by market cap, shed more than one-tenth of its value to go all the way down to $165 on Aug 29. The majority of the top-20 altcoins towed along by exhibiting similar performances.
The sheer hopelessness of the situation was evident in Max Keiser’s assessment yesterday when the RT host stated that it could be only a matter of time until Ethereum takes a nosedive into somewhere around $90.
Twitter user @CryptoGainz1 underlined the somewhat worrying state of the market in a recent tweet:
Money is exiting alts. If bitcoin were breaking down at the same rate, it would be around 7.6k now.
This chart isn't useful for predicting bitcoin targets, but it's very useful for assessing the state of the market imo.
Money exiting alts while bitcoin stagnates is bearish. pic.twitter.com/0WBdqSH54A
— CryptoGainz (@CryptoGainz1) August 29, 2019
At press time, the overall cryptocurrency market cap is hovering somewhere around $242 million, with the Bitcoin Dom Index surpassing 70%.
Worth noting here is that Bitcoin is the only major digital currency not to have tread below 200 on the DMA scale, and has a fantastic Sharpe ratio as well.
Just saw @CoinDeskMarkets post on the top 10 cryptos being under their 200 DMA.
Pretty much the entire crypto market is under the 200 DMA, except for Bitcoin.
You can confidently say most of crypto right now looks like it had a rally in a bear market, besides Bitcoin; so far.
— Cantering Clark (@CanteringClark) August 29, 2019
However, its recent performance has led some analysts to predict that the general lack of enthusiasm surrounding the top altcoins, coupled with selling pressure, could bring some more bad news for Bitcoin and its brethren in the coming days.
Not Everyone Is Down on Bitcoin
On the brighter side, not everyone is painting a gloomy picture. For example, PlanB, a cryptocurrency Twitter account with a large following, drew a parallel between the current market conditions and the one prevalent in mid-2016, just before the momentum build that eventually took Bitcoin beyond the $20k milestone several months later.
— PlanB (@100trillionUSD) August 29, 2019
What about you, though? What’s your take on the sorry state of the altcoin space? Do let us know in the comments below.
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Images courtesy of Shutterstock, Twitter.