Over the past 24 hours, Bitcoin has lost 2 percent of its price against the US dollar, dipping below the $6,300 mark to $6,250.
While cryptocurrency-only exchanges are demonstrating a price of $6,350 for Bitcoin due to the premium on BTC-to-USDT (Tether) pair, the actual price of Bitcoin remains at around $6,256.
The volume of BTC has increased from $3.1 billion to $4.2 billion over the past seven days, by more than 35 percent. But, most of the volume recorded by major cryptocurrency exchanges represent sell orders.
Major Digital Assets and Tokens Take a Hit
As the price of Bitcoin fell below the $6,300 mark for the first time since October 15, the value of major digital assets including Bitcoin Cash (BCH) and EOS fell by more than 5 percent along with small market cap tokens.
Several cryptocurrency traders and technical analysts stated that the abrupt dip in the price of BTC was still a minor movement above major support levels and as such, it is still too early to confirm a bearish short-term trend.
“BTC dipped into a demand area. Absolutely nothing to worry about right now. Still focused on alts and using this opportunity to buy the dip,” AwaitingMonk said.
Andy Chung, the head of operations at OKEx, the third largest cryptocurrency exchange in the global market, emphasized that historically, Bitcoin has tended to dip in value and show a noticeable drop in volume prior to a large short-term rally.
In the weeks to come, before the end of 2018, Chung stated that the stability of BTC for nearly a year could lead to a positive movement on the upside.
“It’s always quiet before a good storm. The market has been calm for almost a year, we can expect something good to happen soon to Bitcoin.”
In September, the volume of Ripple was around $1.8 billion. Since then, the daily trading volume of Ripple has fallen to around $300 million, while the volume of BCH fell below the $300 million mark.
In comparison to the volume of Ethereum (ETH) at around $1.5 billion, trading activity of XRP and BCH investors remain significantly low relative to other major digital assets.
In the short-term, due to the lack of volume, BCH and XRP are more vulnerable to sell-pressure and a dip below important support levels than Bitcoin and Ethereum.
Can Bitcoin Speedily Recover?
Previously, analysts stated that if Bitcoin dips before the end of October, a speedy recovery will be possible as long as BTC does not fall below the $6,000 support level. If BTC can sustain its volume above the $6,200 region, then a short-term corrective rally will be possible.
But, if BTC falls to the low $6,000 region affected by the poor performance of major cryptocurrencies and other tokens, then a further drop to the $6,000 to $6,100 can be expected.
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Last modified: March 4, 2021 3:04 PM