Bitcoin has continued its drop to the low $9,000s to perpetuate an already savage week, taking almost the entire alt market with it, with the potential for further downside to come. As we posted Monday, Bitcoin only had until Thursday to make its mind up about its direction and it has decided a day ahead of the deadline that it wants to go down, at least for now.
Bitcoin’s Bullish Momentum Checked
Bitcoin’s bullish momentum has been well and truly checked in the short term, with each green bounce followed by a bigger red candle this week as the market moves from profit-taking from January’s run to downright bearishness.
Following continuous drops, Bitcoin has seemed to stabilize at the $9,100 region after bouncing at $9,075, with opinion divided in the community as to whether a recovery is on the cards:
If it leaves that channel entirely / doesn’t bounce much after running those stops below us, the situation may be worse than was originally expected imo pic.twitter.com/9aQNu4qph9
— Murad Mahmudov ? (@MustStopMurad) February 26, 2020
Fresh look (1W & 1L reviewed in other thread).
Still not allowed to short right here at the bottom of daily structure, but can sell rallies.
For longs, I can build a position at $8900-$9100 w/ $9500 FTA (counter-trend).
For weakness, $9300 (aggressive) or $9500-$9600. pic.twitter.com/z0e7Op5Pd8
— Cred (@CryptoCred) February 26, 2020
If the Crypto Fear and Greed Index is anything to go by then we should be in line for an upwards move, given that we have experienced a week and half’s worth of fear in the markets, but with the rating currently at 41 there is still plenty of room for it to drop before we see a reversal of any sort:
While the lower time frame looks bad, once again we can take solace by zooming out – on the weekly, we are still well within the upward channel that began in March 2019, with very little likelihood of dropping through the support, which currently stands at around $7,500, given the fundamentals ahead of us.
Alts Put in Their Place
Alts have taken a battering this week, with many big caps such as BCH, BSV, LTC, and XTZ taking double digit hits. Only AION has escaped the wrath of the market, today posting a 30% gain against its USD pairing, while virtually every other token has lost value.
ETH/BTC fell through the support it had been making for itself, suggesting that alts may have had their fun and are, once more, at Bitcoin’s behest:
As a result, Bitcoin dominance has gained two percentage points back this week, moving from 64% to 66%, marking a swift recovery from 62% at the start of the month when alts were running rampant. This adds weight to the suggestion that all eyes should now be on what Bitcoin does in the next 48 hours which will then dictate what alts do from here.