Following a weekend of choppy trading action, the cryptocurrency markets have established a fresh leg down, erasing most of their gains incurred through the recent relief rally that sent the markets up 10% or more from their recently established 2018 lows.
At the time of writing, Bitcoin is trading down 7% at its current price of $3,860, down over 12% from its recent highs of $4,400.
In late-November, Bitcoin set its 2018 low at approximately $3,600 on the aggregated markets, and since then this level has acted as support. Presently, Bitcoin is sitting just 7% over this support level, and its current downwards momentum may drive its price down to this region.
Today’s drop has brought the overall cryptocurrency market capitalization down to $125 billion, which is just $10 billion above its 2018 low of just under $115 billion.
Despite the recent market conditions weakening the industry’s sentiment and causing many investors to lose confidence in the markets, one industry insider is quick to remind investors that the current price action isn’t unprecedented and has been seen before in crypto’s brief history.
While speaking to MarketWatch, Danny Scott, the CEO and co-founder of CoinCorner, a cryptocurrency exchange, said that he has witnessed this exact price action before, and that it is always proceeded with a major parabolic rally.
“If we look back over bitcoin’s short 10-year history, it has experienced many price fluctuations—something that is to be expected given that the industry is still very young. There have been a number of sizeable price movements over the years which have typically gone unnoticed by anyone except those within the industry. For example, in 2013 we saw the price drop 49.88% in just 14 days, which is a bigger drop than the one we have experienced over these last two weeks,” Scott said.
Related Reading: Crypto Market Update: Weekend Gains Wiped Out in $5 Billion Fall
Altcoins Plummet Amidst Bitcoin Selloff
Bitcoin’s downwards price action has led to a widespread selloff in the altcoin markets, and virtually no major altcoins have been able to dodge the effects of the market carnage.
At the time of writing, XRP is trading down 5% at its current price of just under $0.35. XRP is currently sitting about 10% off its recently established lows of $0.32, but is trading down over 10% from its recent highs of $0.40 that were set during the relief rally that proceeded last month’s massive sell off.
Ethereum (ETH) is currently trading down nearly 8% at its current price of $107.84 and is sitting just 7% off its 2018 lows of just under $100. ETH has been battered in the time since last month’s relief rally and is currently down nearly 15% from its recent highs of over $125.
In the coming days and weeks, it will likely become more apparent as to whether or not the $3,600 price level will serve as support for Bitcoin, which will continue to lead the markets amidst the current instability.