The Crypto Market Treads a Decline as Bitcoin Trades Below the $40,000 Mark

The global cryptocurrency market cap faces a decline, with today’s market cap at $1.54 Trillion, a 3.30% decrease from yesterday, Tuesday. However, despite the decline, investor confidence is still strong overall in the market. 

Some of the cryptocurrencies contributing to this decline are Bitcoin and other correlated altcoins. Ethereum, on the other hand, is in the lead with a gain of about 14.19% over the last week. Bitcoin is currently trading at around $38,973.58, while Ethereum is at $2,617.22.

Bitcoin Price Consolidates

Bitcoin price extended its decline this week below the 39,000 support level. It even went on to break the $38,500 level to get into the bearish zone. A low was formed near the $37,600 level, but at the moment, it is attempting an upside correction back to the $40,000 level.

The significant fall from the $42,630 swing high to $37,660 low is near 23.6% Fib retracement level. The next significant resistance is about $39,500. Near the $40,000 level and 100 hourly moving average, the primary resistance is already building.

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The latest reversal may put the support area between $37,300 and $36,500 into play. Katie Stockton, managing director of Fairlead Strategies, is expecting the pullback to mature in a period of one to two weeks at around $34,000 near the 50-day moving average. She added that after that, Bitcoin is likely to clear $42,600 for a revised upside target near $51,000.

Ethereum is On the Lead

Ethereum, the second-largest crypto by market cap, has finally broken out of a two-month-long consolidation relative to bitcoin. However, the ETH/BTC ratio faces resistance near the 0.07 level, and a decisive break above that level could cause movement towards 0.08. 

The cryptocurrency gained 2.04% on Monday after a 0.86% gain on Sunday. Today, it is trading at $2,617.22 after a 4% gain from Tuesday. ETH’s support level is forming at the $2,440 and $2,330 levels. A decisive breakdown below $2,440 might accelerate losses. 

In the stated case, the price could quickly test $2,400. The next significant support could be close to the level of $2,330, where bulls might stand.

Other Altcoins Gaining Despite the Bitcoin Decline

Mostly, when the price of Bitcoin goes down, major altcoins that remain correlated with the cryptocurrency also decline. Today, most of them have gone down by 2 to 3 percent.

Btc

Bitcoin

$27.945
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1.30772%
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However, Cardano (ADA), Terra (LUNA), and Solana (SOL) did not follow this trend. LUNA especially caught headlines today with a 20% gain on the back of solid demand for stablecoin, a blockchain protocol backing TerraUSD stablecoin.