Get the weekly summary of crypto market analysis, news, and forecasts! This Week’s Summary The crypto market ends the week at a total market capitalization of $1,165 trillion. Bitcoin is up by over 2% after a rollercoaster of a week. Ethereum decreased by almost 1% over the past seven days. XRP gained more than 15% in value this week. Almost all altcoins are trading in the green, with very few exceptions. The DeFi sector decreased the total value of protocols…
BTC looks to Regain $33K Support After Plunge that Sent Many Cryptos’ Prices Down
On Thursday, bitcoin fell below the $33,000 level sending the whole cryptocurrency market into a frenzy. Some coins such as Ether, Cardano, Dogecoin, Polkadot, and Dogecoin followed suit with drops of around 10%.
The cryptocurrency has been trading at around half of its April peak, at $65K, for the past two months. However, it is currently starting to regain the $33K level and is trading at around $33,372.
What Caused the Price Plunge?
The price plunge was noted when reports started spreading around that Tokyo was declared a state of emergency by Japan. Tokyo is scheduled for the upcoming Olympics, but the rising Covid-19 cases might render this impossible.
Due to the reports, stock futures dipped, and early trading firms who might profit from a comeback decreased. Similarly, the 10-year Treasury yield dropped to 1.25%.
Investors have become increasingly cautious over what the central bank is planning about central banks. They are especially concerned about the U.S. Federal Reserve reducing prolific support for cratering markets at the epidemic’s beginning.
Sen. Elizabeth Warren, D-Mass., cautioned in a letter to Chairman of the Securities and Exchange Commission, Gary Gensler, that the “very opaque and volatile” cryptocurrency market is presenting risks to consumers and financial markets.
She also said that even though the demand for cryptos and their exchanges has sky-rocketed, there are no regulations. In turn, investors are left to look out for themselves in a sector that has often been associated with manipulators and fraudsters.
For years China has been banning the cryptocurrency sector and activities frequently. On Tuesday, the Chinese central bank asked for further suspension of the firm suspected of supplying virtual currency transactions with software services. It could have also contributed to the price drop.
Bitcoin Price May Still Rise
though there are many price corrections in bull markets, they can still happen in bear markets. As a result, price adjustments can go up or down either way.
The plunge might indicate the price adjustment from last week’s price surge. Usually, individuals get a profit from coins when they get prices up in such a short length of time if they expect the price to decrease rather than increase.
Bitcoin has already rebound a little bit, which may imply the price correction of this drop. It has been trying to recover from the highs of May. It has lingered around the region of $30,000, down from its all-time high of $65,000 in April. Despite the uncertainty, most traders are predicting that Bitcoin may grow even more significantly. Some traders forecast bitcoin will grow longer.
Nevertheless, others think it may go down to $20,000 before institutional investors return to it. On the other hand, stocks and futures are gaining today as investors buy on yesterday’s dip.