The crypto market has lost its momentum yet again after the relief rally diminished over the weekend. One of the major reasons for this fall is the increasing market FUD for the Fed’s meeting.
As we approach a crucial junction, Bitcoin [BTC] has yet again dropped below the $21,500 mark.
A sentimental shakedown
The bears were in full control over the weekend and pushed down the asset. But 25 July saw a major dip as Bitcoin crashed below $22,000. The next day registered a similar pull down with Bitcoin going down the $21,000 mark.
But it reacted positively to this fall and at press time, it was trading at $21,322. In this regard, analytical firm Glassnode stated that,
“Momentum in the short-term suggests continuation of the upswing, provided the Realized Price and Long Term Holder Realized Price can hold as a support level. On the long-term, momentum suggests the worst of the capitulation could be over, however a longer recovery time may be required as foundational repair continues.”
There’s more here
A recent Glassnode update claimed that the shrimp cohort has started accumulating BTC massively. Shrimps (< 1 BTC) have increased their holding of circulating BTC supply from 5.2% to 6%.
This jump of 0.8% happened since the LUNA collapse and equates to around 156K BTC.
That being said, Mike McGlone, Senior Commodity Analyst at Bloomberg Intelligence remains optimistic about Bitcoin.
In his latest tweet, McGlone stated that Bitcoin may be in line for a reversal in the second half of 2022.
This is a particularly bold statement since Bitcoin has shed a lot of its value since the beginning of the year. McGlone asserted that Bitcoin is one of the “fastest horses” in the race since its inception.
The lowest-ever #Bitcoin volatility vs. the Bloomberg #Commodity Index (BCOM) may portend a resumption of the crypto's propensity to outperform. Our graphic showing the elongated upward trajectory of Bitcoin's price vs. the BCOM is typical compared with most assets. pic.twitter.com/vufd4qouVj
— Mike McGlone (@mikemcglone11) July 25, 2022
Now, as we approach a crucial decision from the Fed, the crypto market continues to shed gains. Losses mounted up to $50 billion on 26 July.
This puts the market at risk as it dived below the $1 trillion mark in market capitalization.
Being the figurehead of the crypto market, Bitcoin is itself struggling to hold down its guard. The $21,000 support also looks stable but remains bleak with an eye into the recent past.