The cryptocurrency market has dropped by more than $30 billion overnight, from $408 billion to $377 billion. Major cryptocurrencies such as bitcoin, Bitcoin Cash, EOS, and Cardano dropped in the 5 to 13 percent region, with Bitcoin Cash and EOS dropping 11 percent and 13.5 percent respectively.
Traders have often described Bitcoin Cash investment as leveraged bitcoin trading because on both the upside and downside, Bitcoin Cash moves by larger margins. Throughout April, as the market continued to recover and bitcoin started to gain momentum in the $9,500 region, Bitcoin Cash experienced a 10 to 20 percent increase in value quite regularly.
However, as the cryptocurrency market started to fall, Bitcoin Cash began to record losses with significantly larger margins in comparison to bitcoin and Ethereum. Today, on May 16, Bitcoin Cash fell by more than 6 percent against both bitcoin and Ethereum, which also fell by 5 percent.
The Relative Strength Index (RSI) of Bitcoin Cash is at 50, signifying a neutral zone for BCH. If the RSI of BCH signifies an oversold condition, the price of BCH could bounce relatively quickly in the short-term but given that the RSI of BCH is neutral and both exponential and simple moving averages are demonstrating a negative short-term trend for BCH, it is likely that the price of BCH will continue to fall over the next 24 hours.
Other cryptocurrencies and tokens that have performed strongly against the US dollar over the past month such as EOS and 0x (ZRX) have also slumped over the past week. EOS has dropped by more than 38 percent from its monthly peak in April against bitcoin.
Within a period of two weeks, the price of EOS declined from 0.0024 to 0.00149 BTC, by 38.17 percent. Considering that the price of EOS increased from 0.0009 to 0.0024 BTC from early April to April 29, the sudden drop in the price of EOS was unexpected.
But, the struggle of EOS, which has been able to secure strong momentum throughout April, demonstrates the current state of the market. Despite the initiation of the Blockchain Week in New York and the Consensus 2018 event, the cryptocurrency market is failing to rebound from its short-term losses.
On CNBC, BitMEX CEO Arthur Hayes stated that he sees the price of bitcoin reaching $50,000 by the end of 2018, despite the correction the market has seen from February to May.
BitMEX, which supports margin trading, profits from both the downside and upside of bitcoin because traders can register short and long contracts.
“If it goes up, if it goes down, if you have Bill Gates calling it a fraud … Short it, I don’t care. If you think it’s going to be $1 million in a few months, great, buy it. I still don’t care. We just match trades,” Hayes said, emphasizing that his prediction of bitcoin reaching $50,000 is objective as increase in the price of bitcoin does not impact the profitability of the exchange.
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Last modified: May 20, 2020 8:47 PM UTC