Bitcoin Shows Crypto Malaise
- Bitcoin still the leader
- Looking very soft
- Crypto markets losing volume
Bitcoin markets fell a little during the trading session on Tuesday, after falling even further on Monday. It looks very likely that the market is going to continue to struggle in general, as we have just simply started to drift lower and show signs of exhaustion.
Remember, as Bitcoin goes, so go the rest of the cryptocurrency markets. We have seen a lot of selling pressure more than once, and now that volumes are dropping, this is a bad sign for cryptocurrency as well.
Technical analysis
Bitcoin chart
The 200-day EMA is currently sitting just above pricing, which is a very bearish sign. The fact that the markets have broken through first the 50-day EMA and then the 200-day EMA suggests that we are going to continue to struggle.
Underneath, the $7500 level was the scene of the most recent bounce and volume spike – which was the last time we had seen significant interest in the Bitcoin market. This coincides with the Chinese announcing that they were getting ready to do heavy research into blockchain. However, that’s not to be mistaken as saying that Bitcoin is something they are backing, so the reaction was a bit perplexing.
Beyond that, the reaction had the market rallying towards the $10,000 level but being unable to break above it. With that, it’s very likely that the market had come to its senses, realizing that the Chinese were not big fans of a vehicle that had been used to skirt capital controls.
Going forward
Regardless of what cryptocurrency you choose to trade, the Bitcoin market is something you should be paying attention to at all times. After all, it has a huge influence on the way the rest of the markets trade, due to the fact that it holds a huge majority of the trade in cryptocurrency. It is used as a secondary indicator for many other cryptocurrency markets, as it shows general strength overall.
Beyond that, one thing that should be noticed is that Bitcoin has been failing as central banks around the world continue to show signs of dovish behavior. This is a bit ironic, considering that Bitcoin is deemed to be the “antidote” of fiat currency.
If it can’t rally when central banks around the world are loosening monetary policy hand over fist, the question then becomes: when can Bitcoin rally for any significant amount? At this point, it’s clearly not a reality.