July 22, 2024

Altcoins Plunge, 40% Drop Looming?

Bitcoin’s recent slide has cast a shadow over the entire crypto market. As Bitcoin drops, it’s dragging most alternative coins, or altcoins, down with it, causing widespread losses.

Ethereum, which recently reached above $3,300, has now fallen below $3,200, marking a 4% daily drop. But it’s not just Ethereum; other major altcoins like Solana, Dogecoin, and Cardano are also seeing declines ranging from 5% to 8%.

While some altcoins are holding up better, others like CORE, PEPE, GALA, and FLOKI are taking more significant hits. This collective downturn has led to a massive decrease in the total crypto market cap, dropping by over $60 billion to $2.430 trillion.

The Bloodbath Continues…

Analyst Benjamin Cowen believes altcoins could face a rough road ahead, possibly dropping by up to 40% against Bitcoin in the coming months. Cowen bases his prediction on historical trends, noting declining social interest and looming uncertainty over Federal Reserve rate cuts.

Cowen compares this situation to previous cycles, highlighting how ALT/BTC pairs tend to falter just before rate cuts, hinting at further declines. Despite short-term fluctuations, Cowen remains firm in his view on altcoins, emphasizing their ongoing struggles amid dwindling social interest, similar to challenges faced in 2019.

Beware, Investors: Volatility Ahead!

With Bitcoin’s price dropping to $59,500 and altcoins undergoing deeper corrections, analysts anticipate a possible further decline, with predictions hovering around $52,000 if it breaches the $58,000 threshold, representing a 100-day EMA.

Analysts like Patric H. warn of a challenging emotional journey for investors in May, anticipating a final shake-out period within the next 2-6 weeks before a potential breakout. This highlights the current euphoric sentiment in the market and ongoing outflows from Bitcoin ETFs.

What Next for Bitcoin?

Bitcoin’s price has been on a rollercoaster ride lately. After nearing $65,000 on Monday morning, it dropped to $62,000, then further to a two-month low of $59,100, followed by a brief pump. The bears have since driven the price down to just over $57,000, marking the lowest point since February 28.

This downturn coincides with the upcoming US Federal Open Market Committee (FOMC) meeting, often linked with increased market volatility. Anticipation surrounding the Federal Reserve’s interest rate announcement has stirred FUD (fear, uncertainty, and doubt) in the market, triggering a surge in the dollar index as investors seek refuge.

The crypto market is known for volatility. Remember, this too shall pass, but always do your own research before investing.

Also Check Out : Here’s When Bitcoin (BTC) Price Will Initiate a Fresh Rally

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