Market Overview
The crypto market cap has fallen by approximately 2% over the past 24 hours to $2.41 trillion. The market is cooling after a mid-week surge, consistent with the trend of large capital selling on the growth. The price jump is generating impressive speculative interest, allowing large players to carefully sell larger volumes over a long period without putting excessive pressure on the price.
Bitcoin is cautiously retreating for the second day to $70.5K, having encountered resistance and exhausted its growth momentum from the liquidation of short positions a couple of days ago. Short-term obstacles to growth are the 50-day moving average and the 61.8% level of the decline from 14 January to 6 February. Bears are proving that they are in control, keeping Bitcoin within the correction range. In such conditions, there is a higher chance of movement towards the lower end of the range, which can be called typical behaviour for the end of the week in recent months.
The start of March has been quite successful for Ethereum, with gains after six weeks of decline. Particularly encouraging is the ability of the second-largest cryptocurrency to rebound from the long-term support level of the uptrend and attempt to consolidate above $2,000. Our attention here is focused on the $2,500 area, where the 200-week moving average is located. Consolidation above this level promises to be a prelude to a sustained recovery.
News Background
Messari has recorded the return of retail investors to the market. Net inflows into stablecoins jumped 415% to $1.7 billion over the week. The number of daily transfers increased by almost 10%.
According to Glassnode, 43% of Bitcoin’s market supply is in the red. With the further recovery of BTC, investors may start to get rid of coins, which will limit the possible growth. Additional pressure comes from miners. Mining profitability has fallen to historic lows amid high electricity prices.
Mining companies have been liquidating coins over the past few months, and recent reports from major players suggest the trend may intensify, according to TheEnergyMag.
BitMEX co-founder Arthur Hayes called Bitcoin’s recent rise above $70,000 a ‘dead cat bounce’ that does not signal a shift from a bearish to a bullish trend. In his opinion, the price of the first cryptocurrency may go down again.
