bitcoin

Bitcoin Volume Approaches Yearly Low Again as Market Deletes $6 Billion



bitcoin price

Over the past 48 hours, the volume of Bitcoin (BTC) has fell substantially from over $5 billion to $3.8 billion, and is quickly moving to its yearly low.

On CoinCap.io, ShapeShift’s official cryptocurrency market data provider, the volume of Bitcoin remains at around $2.54 billion. If the volume of BTC drops by around 15 percent in the days to come, then a new yearly low could be reached.

The low volume of Bitcoin is a concerning indicator for the short-term trend of the market because since early August, BTC has shown a high level of stability supported with low daily trading activity.

Bitcoin Needs to Begin Showing Strength

As cryptocurrency investor Roy Blackstone recently explained, Bitcoin has to begin showing strength in terms of volume, price trend, momentum, and daily trading activity in order for the rest of the market to remain afloat, above key support levels.

“It’s not alt season until:  ‘long term investors’ sell at breakeven, media hype machine starts, your best friend is getting rich off crypto, alt pumps across the board on exchanges like polo, bitcoin starts to show real strength.”

With Bitcoin demonstrating yearly low volumes on a regular basis, the cryptocurrency exchange market is not in a viable position to see a sudden increase in demand from speculators and retail traders.

Many traders, especially in the cryptocurrency exchange market, often attempt to purchase digital assets that are significantly down from their all-time highs to catch a large upside break. However, it only works if an asset breaks a long-term descending trendline with strong volume and a promising short-term rally.

While BTC had briefly broke out of a descending trendline dating back to January last week, the breakout was short-lived and from its monthly high of $6,700, BTC declined back to $6,400.

The lack of momentum in Bitcoin has led tokens and small market cap cryptocurrencies to struggle. Rchain, GXChain, MOAC, WanChain, Nano, Loopring, ICON, 0x, Tezos, and several other tokens demonstrated a 5 to 10 percent decline in value against both the US dollar and BTC.

Several analysts offered contrasting opinions, including a technical analyst known as CryptoYoda, who emphasized that the dominance index of BTC suggests an influx of capital into tokens is imminent.

“BTC Dominance indicating top might have been reached. In previous cases, similar structures led to strong selloffs, meaning capital flowing out of btc into alts. Both context and altitude in favor of a move down. Close below 50% would confirm altseason.”

Where Market Goes Next

Since achieving $6,700 earlier this week, the crypto market has been stagnant. The volume of Bitcoin has consistently declined, momentum of tokens has faded, and trading activity in the cryptocurrency exchange market dropped.

Generally, the sentiment around the mid-term growth of the cryptocurrency sector is still positive due to the progress made by major financial institutions such as Goldman Sachs to strengthen the infrastructure of the market.

On October 18, Goldman Sachs invested in cryptocurrency custody provider BitGo, reaffirming its interest in serving the digital asset market and institutional investors within it.

Featured Image from Shutterstock. Charts from TradingView.

Follow us on Telegram or subscribe to our newsletter here.
Join CCN’s crypto community for $9.99 per month, click here.
Want exclusive analysis and crypto insights from Hacked.com? Click here.
Open Positions at CCN: Full Time and Part Time Journalists Wanted.

Advertisement




READ SOURCE

Leave a Reply

This website uses cookies. By continuing to use this site, you accept our use of cookies.