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Why is Crypto Market Down Today
The crypto market has taken a significant downturn in recent days, with a 4% decline in capitalization. The total market capitalization now stands at approximately $3.54 trillion. In this article, we will explore the reasons behind this unexpected drop.
One of the primary factors contributing to this decline is the accusation against Donald Trump and his team regarding a “pump and dump” scheme involving memecoins. The Official Trump (TRUMP) token and Melania Trump’s self-branded memecoin have combined market capitalization of over $15 billion. Critics are calling out Trump for manipulating the market for personal gain, leading to uncertainty among investors.
A further contributor is profit-taking. On-chain data from Santiment shows that the 7-day Market Value to Realized Value (MVRV) ratio has reached levels where investors typically book profits. Historically, this indicator’s 7-day moving average (MA) tends to reach around 3%, which may signal a reversal in the market.
Finally, liquidations have exacerbated the downturn. According to CoinGlass, $1.18 billion worth of positions were liquidated over the past 24 hours as Bitcoin briefly dropped below $100,000. Long traders were hit particularly hard, with $921 million in liquidations compared to $260 million in short positions. Binance recorded the largest single liquidation order, valued at $15.5 million.
Despite this correction, experts believe that Bitcoin’s breakout above $99,800 represents a crucial step forward. The next key level of interest would be $105,700, with potential for higher prices if achieved. Using Fibonacci levels, Bitcoin’s projected target is predicted to reach $120,362 in the coming weeks, indicating optimism about the market’s future.
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Source: coinpedia.org
