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Why is the cryptocurrency market down today? Here are the top 5 reasons
A third day of negative price activity in the cryptocurrency market indicates negative sentiment. The cross-border market fell by $90 billion to $2.17 trillion, a loss of 3.67%, over the past day. Bitcointhe market leader, fell 3.27% to $58,067.63 in 24 hours. Bitcoin fell 3.6% to $60,490 on July 1 due to selling pressure and German Government Sales.
Everyone is wondering: has Bitcoin started a long bear market or is it simply a bull market?
According to Wise Advice, a cryptocurrency analyst, the cryptocurrency market is in decline for several reasons. He pointed The main drivers are massive withdrawals, liquidations, mining activity, government actions and market sentiment indicators.
Why are cryptocurrencies dumping?
Spot ETFs See Significant Outflows Causing Tsunami
Another outflow has hit the BTC ETFs July 3. In altcoins, a crypto whale sold millions of dollars worth of coins, suffering significant losses. Leading blockchain analytics tool Lookonchain said that this whale or institution sold 3.13 million LDO tokens worth $5.77 million, 49,771 AAVE tokens worth $4.54 million, 269,177 UNI tokens worth $2.41 million, and 250,969 FXS tokens worth $708,000.
Liquidation on the rise
Furthermore, the market has been hit hard by the rising liquidations. Just yesterday, BTC liquidations reached $14 million, but today this figure has risen to $36 million. These large-scale liquidations have triggered widespread selling, further pushing the price down. BTC Price.
Miners: Are They Influencing the Decline?
Currently, BTC miner capitulation is one of the main factors contributing to the price decline. The mining community is also under pressure, with persistently low hash rate leading to a decline in earnings. As a result, many miners are selling their BTC to maintain operations or switching to other proof-of-work tokens to sustain profitability.
The government sell-out
The German government’s actions have added to market fears. The government has recently moved BTC around, causing panic among investors who are preemptively selling their holdings in anticipation of potential market impacts, even though the government has not yet sold any coins.
Medium-term expectations? Bearish!
Finally, market sentiment has turned bearish, as indicated by a chart that tracks Bitcoin flows in spot and derivatives trading. This chart, currently in its negative zone, indicates a bearish outlook, with red indicating a bearish mood and green indicating a bullish sentiment.
Furthermore, Bitcoin lost several key support levels in June, suggesting a medium-term bearish trend, with the focus now on holding support above $60,000 as the weekly Relative Strength Index (RSI) approaches 50. Analysts warn that if bearish sentiment continues, Bitcoin could drop to around $48,000 before potentially rebounding, marking a critical test of its resilience amid the current market turmoil.
So, is Bitcoin a roller coaster or smooth sailing? Place your bets.
Read also: Here’s How Much Bitcoin Price Can Fall? A Top Analyst Says