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The crypto market is down, but when will it go back up? Here’s what you need to know.
Crypto Market Go Back Up?’ style=”display:none”>Checkout this video:
Introduction
It’s been a tough few weeks for cryptocurrency investors. The price of Bitcoin, the world’s largest digital currency by market value, has fallen by more than 50% since it peaked at nearly $20,000 in December. Other major cryptocurrencies have also plunged in value.
This sell-off was long overdue. For much of 2017, the prices of Bitcoin and other digital currencies soared to unsustainable levels, propelled by speculative mania. In recent months, though, the cracks have started to show, with prices tumbling as investors have cash out their profits.
But the question now is whether this is simply a healthy correction after an epic run-up, or the start of a more prolonged bear market? No one knows for sure. But there are some factors that suggest the latter scenario is more likely.
First, we’re still in the midst of a broader sell-off in global financial markets. Stock markets around the world have been falling in recent weeks amid concerns about rising interest rates and inflation. When investors get jittery about these things, they tend to pull back from riskier assets like cryptocurrencies and pour their money into safe havens like government bonds.
Second, many people who bought Bitcoin and other digital currencies last year did so because they expected prices to keep rising indefinitely. Now that prices have started falling sharply, these investors are panic selling to avoid even bigger losses. This selling pressure is likely to continue as long as prices remain volatile.
Third, regulation is starting to bite. In recent months, governments around the world have begun cracking down on cryptocurrency exchanges and Initial Coin Offerings (ICOs). This has made it harder for investors to buy and sell digital currencies, which is driving down demand and putting even more downward pressure on prices.
Finally, there’s growing evidence that much of the trading activity in cryptocurrency markets is being driven by automated bot programs rather than real human beings. This means that there’s less real buying interest than it appears on surface — which could lead to sharp price falls if bots start selling en masse.
Market Trends
The crypto market has been in a slump for the past few months, but there are signs that it may be picking back up. The market is notoriously volatile, so it’s difficult to say for sure, but let’s take a look at some of the indicators.
Bitcoin
As of late, Bitcoin has been on a tear, more than doubling in price since early October 2020. After hitting a low of around $3,700 in December 2018, the leading cryptocurrency by market capitalization climbed to over $10,000 in 2019. And while the COVID-19 pandemic caused a dip in prices in early 2020, Bitcoin quickly rebounded and surged to new all-time highs later in the year. So, what’s driving Bitcoin’s recent price increases?
Here are three key factors that could be contributing to Bitcoin’s market rally:
1) Increasing institutional adoption: In 2020, we saw a number of major corporations and financial institutions begin to invest in Bitcoin. From Square and PayPal allowing customers to buy and sell BTC on their platforms to BlackRock adding BTC to its balance sheet, mainstream companies are increasingly turning to Bitcoin as a store of value. This institutional adoption is crucial for crypto assets as it helps legitimize them as an asset class and drives up demand (and prices).
2) Gradual acceptance by the mainstream financial system: While Bitcoin is still not widely accepted by traditional financial institutions, we are seeing increasing signs of acceptance. For example, earlier this year Goldman Sachs announced plans to offer bitcoin derivatives trading for its clients. And last month, JPMorgan Chase announced that it would start offering JPM Coin — its own digital currency — to CEO Jamie Dimon says he’s “open-minded” about cryptocurrencies businesses clients for settlements. As crypto assets become more integrated into the existing financial system, we expect demand (and prices) to continue to increase.
3) Rising interest from individual investors: Not only are institutional investors flocking to Bitcoin, but individual investors are as well. Data from investment platform eToro shows that Bitcoin was the most popular asset among its users in 2020, with over 10% of all trades placed on the platform involving BTC. And a survey by asset manager Grayscale found that one-third of millennials say they would rather invest $1,000 in BTC than stocks. This growing interest from (mostly younger) retail investors is likely driving up prices as well.
Ethereum
Ethereum is still down from its all-time high in January 2018, but it has had a strong 2019 so far. The problem with predicting market trends is that there are too many variables to consider. Factors like regulation, innovation, and global economic conditions can all affect the price of Ethereum.
The best way to predict the future price of Ethereum is to look at the past price action and try to identify patterns. Technical analysis can be helpful in this regard, but it is not foolproof. The best thing you can do is stay up-to-date on all the latest news and events affecting the cryptocurrency markets.
Litecoin
Litecoin is currently on a downtrend, after reaching an all time high on December 13th of 2017. Most experts are attributing this to the current Bitcoin bubble, which has reached unprecedented levels. Many experts are now saying that the market is due for a major correction, and that Litecoin will most likely be one of the first currencies to rebound.
Bitcoin Cash
Bitcoin Cash is a cryptocurrency that is a fork of Bitcoin. Bitcoin Cash is trading at $252.51 as of 4:00 PM on March 18, 2020. This is a drop of $10.49, or 4.01%, in the last 24 hours. The current market cap for Bitcoin Cash is $4,640,149,859. There are 18,379,687 BCH in circulation.
Bitcoin Cash had an all-time high of $4,355 on December 20, 2017.Since then, the price has been on a steady decline. In the last year, the price has fluctuated between $235 and $330.
The current market trend for Bitcoin Cash seems to be heading in a downward direction with no end in sight.
Ripple
Ripple is a cryptocurrency that is focused on solving the problem of international payments. It is one of the oldest cryptocurrencies, dating back to 2012. Ripple is different from other cryptocurrencies in that it is not intended to be used as a currency, but rather as a way to make international payments more efficient. Ripple has partnerships with major banks and financial institutions around the world, which has allowed it to become one of the most popular cryptocurrencies.
Market Analysis
It’s been a tough few months for cryptocurrency investors. After reaching all-time highs in December, the market has been on a steady decline, with no end in sight. So, when will the market go back up? Let’s take a look at the data.
Market Cap
What is market cap?
Market capitalization, or “market cap,” is one way to value a cryptocurrency. It’s calculated by multiplying the total supply of coins by the coin’s price. So, a $1 coin with 100 million coins in circulation would have a market cap of $100 million.
What is it used for?
Market cap gives you an idea of how much money would be needed to buy up all the coins in circulation. It’s useful for seeing how large a cryptocurrency is in terms of its circulating supply and total value.
How is it different from price?
Price is the current value of one coin on the market. So, if one coin is worth $1 and there are 100 million coins in circulation, the market cap would be $100 million. Market cap doesn’t always go up when the price goes up though. If the circulating supply changes (say, if there’s a token burn), then market cap will change even if the price stays the same.
Why does market cap matter?
Market capitalization can be used to see how much money is needed to buy up all the coins in circulation, and it’s also a good indicator of a cryptocurrency’s liquidity. If there’s more money chasing fewer coins, that should drive up prices.
24-Hour Trade Volume
The 24-hour trade volume of a cryptocurrency is an important metric to consider when making investment decisions. It represents the total amount of USD that has been traded in the past 24 hours and can be used to gauge market sentiment and identify potential trading opportunities.
Looking at the 24-hour trade volume can also help you avoid making trades during times of low activity, which could lead to getting stuck in a position or missing out on a profitable opportunity.
When looking at the 24-hour trade volume of a cryptocurrency, it is important to compare it to the coin’s market capitalization. A high 24-hour trade volume relative to the market cap can indicate that the price is likely to move soon, as there are more buyers than sellers.
You can find the 24-hour trade volume of a cryptocurrency on most major exchanges and data websites like CoinMarketCap.
7-Day Price Chart
The market is still in the correction stage, with volatile swings being a common occurrence. However, there are some analysts that are seeing this as a good opportunity to start buying again.
The 7-day price chart for Bitcoin (BTC) shows a market that is still very much in correction mode, with prices seeing volatile swings on a daily basis. This has been the case since BTC peaked at $12,000 in early August and then fell to a low of $9,100 just days later. Since then, prices have been ranging between $10,500 and $11,800.
Looking at the chart, it seems as though the market is still trying to find its footing after such a large correction. However, there are some analysts that believe this is actually a good time to start buying again.
One analyst that believes this is the case is Josh Rager, who stated that BTC has now found support at the $10,800 level and could start to move higher in the coming days and weeks. He also believes that $12,000 could be reached by the end of September if everything goes according to plan.
Another analyst that shares this bullish sentiment is Willy Woo, who stated that BTC is now in the process of bottom formation before it starts to move higher again. He believes that BTC will reach $20,000 by early 2021 if everything goes according to plan.
So, there are definitely some traders and analysts out there that believe now is a good time to start buying Bitcoin again. Of course, only time will tell if this turns out to be the case or not.
Conclusion
In conclusion, no one can accurately predict when the crypto market will go back up. However, by analyzing the market trends and understanding the underlying technology, you can make a more informed decision about when to invest.
