Bitcoin Tanks on Monday: Crypto Market Faces Severe Bearish Turn

5 agoThe crypto market faced a significant downturn on Monday, marking what seems like a Black Monday event. Bitcoin (BTC) led the decline, plunging nearly 10% to hit the $50,020 mark, triggering alarm among investors. Ethereum (ETH) wasn't spared either, crashing almost 20% amidst a broader market slump influenced by major dumps from trading giants like Jump Trading.

Key Developments
- Bitcoin (BTC): The leading cryptocurrency plummeted 10.78% in the past 24 hours, resting at $54,191.08. The coin experienced a volatile trading day, with lows at $52,559.19 and highs at $61,058.94. Bitcoin’s market dominance increased by 0.98%, now standing at 56.62%.

- Ethereum (ETH): Ethereum’s price saw a severe crash, dropping nearly 20%. The sharp decline in ETH price further accentuated the bearish momentum across the broader altcoin market.

- Market Impact: The overall global crypto market cap plunged by 12.50%, settling at $1.89 trillion. Despite the downturn, the total crypto market volume surged by 86.72% to $124.44 billion, indicating a high level of trading activity during the sell-off.

Broader Market Trends
The bearish trend wasn't confined to Bitcoin and Ethereum. The altcoin market largely mirrored this negative sentiment, with most cryptocurrencies posting significant losses. The only gainer in the top ranks was Tether Gold, which edged up by 0.15% to $2,449.72.

Contributing Factors
Regulatory scrutiny continues to weigh heavily on the crypto market. Bitcoin critic Peter Schiff predicted that Bitcoin ETFs might see a 15%-30% drop below their January highs, adding to the bearish outlook. Also, According to CryptoQuant analyst Julio Moreno, if Bitcoin fails to regain the crucial support level of 57K, the market could see further declines, potentially reaching a $40,000 price target.

The bearish crypto trend was exacerbated by a collapse in the Japanese markets. This global financial unease prompted the U.S. Federal Reserve to announce an emergency meeting to discuss rate cuts. Analysts are anticipating a 50 basis points cut, which is seen as an effort to cushion the market crash and potentially aid recovery.

Market Outlook
The cryptocurrency market has recently witnessed significant declines, leading to heightened volatility. Although some short-term recovery has been observed in the hourly charts for Bitcoin (BTC) and Ethereum (ETH), the predominant sentiment remains bearish. Investors are advised to exercise caution as the market undergoes adjustments to these new dynamics.

The daily price chart of BTC illustrates a bearish reversal pattern following an extended period of consolidation. Further accentuating the bearish trend is the Relative Strength Index (RSI), currently positioned at 26.

Of note is the resurgence of BTC subsequent to its drop to the $50,000 support level, with a subsequent surge to $53,727 observed at the time of composition, signifying robust investor interest in the asset.