Why Did the Crypto Market Crash? | Credit: Derek Fenech
Share
Key Takeaways
The Crypto Market (TOTALCAP) crashed by 10% this week.
The Bitcoin (BTC) price decreased below $98,000.
Why did the crypto market crash, and will it ever go back up?
The crypto market is taking another hard hit, leaving traders wondering if it will ever recover.
With TOTALCAP sliding sharply and Bitcoin dropping below the key $98,000 level, fear has hit its highest levels in a year.
The charts are showing clear signs of weakness, and the recent price action isn’t giving bulls much to work with.Let’s take a closer look and determine when the crypto market crash will come to an end.
What’s Causing Crypto to Crash?
The TOTALCAP has fallen precipitously since its all-time high of $4.27 trillion on Oct. 4.
The breakdown accelerated in October when the price fell to a low of $3.24 trillion, after which the crypto market recovered, creating a long lower wick.
At first glance, the decline did not seem extremely bearish, since the price validated a diagonal resistance trend line and then recovered above $3.6 trillion.
Get These Top Crypto Casino Offers Now!
Sponsored
Disclosure
We sometimes use affiliate links in our content, when clicking on those we might receive a commission at no extra cost to you. By using this website you agree to our terms and conditions and privacy policy.
Momentum indicators are also extremely bearish. After generating bearish divergences, the Relative Strength Index (RSI) and Moving Average Convergence/Divergence (MACD) indicators fell; the former is now below 50, while the latter remains negative.
Due to these bearish readings, the crypto market could continue its decline to $2.92 trillion and possibly $2.50 trillion before recovering.
The weekly chart aligns completely. After finishing a five-wave upward movement since the cycle low, the crypto market broke down from an ascending wedge, confirming the end of its ending diagonal pattern.
Since the five-wave increase has been ongoing since the start of the cycle, its conclusion means that the cycle is over.
Adding to this bearish price action, the BTC price created a bearish candlestick for November (red icon), a sign of a market top.
Furthermore, the RSI and MACD created bearish divergences, and the latter has made a bearish cross.
Relative to the rest of the crypto market, Bitcoin is still in its early stages of the crash. Alternatively, the crypto market is already halfway down to its support level.
If Bitcoin continues to decline, the next closest support level will be between $57,600 and $70,600, representing another decrease.
More Downside Awaits
All signs currently point toward a deeper correction, with both TOTALCAP and Bitcoin exhibiting strong bearish momentum across multiple timeframes.
The breakdowns, divergences, and failed support levels indicate that the current cycle has likely peaked.
The crypto market has crashed much harder than Bitcoin. If the latter accelerates its decline, the rest of the market could quickly plunge.
Disclaimer:
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
Valdrin Tahiri is a cryptocurrency analyst and reporter at CCN, specializing in technical analysis with a focus on Elliott Wave theory, on-chain metrics, and fundamental research. He brings over seven years of experience in the crypto space as both a trader and writer.
He discovered cryptocurrencies in 2017 while earning his MSc in Financial Markets at the Barcelona School of Economics, which sparked a deep interest in blockchain and market dynamics. Since then, he’s contributed to top crypto outlets like BeInCrypto and CoinGape.
Valdrin also served as Community Manager of BeInCrypto’s Telegram group for three years, helping grow it into one of the largest crypto communities worldwide. His expertise in market structure and price patterns allows him to break down complex trends into clear, actionable insights.
He’s published thousands of articles covering altcoins, Bitcoin cycles, and macro trends.
