- The crypto market cap is still hovering below a crucial level
- After two failed attempts to get above $1.08 trillion, the market still can’t maintain it
- Until it turns this resistance into support, more downside could be on the cards
The crypto market is still sitting below a crucial total value level, as Bitcoin struggles to make more headway going into the weekend. Despite a recent rally in Bitcoin and alt coins, the entire market value still can’t breach a key level, and until it does so there is no guarantee that the current relief rally could continue. Indeed, it could get much worse.
The Trillion Dollar Question
The area in question is between $1.03 and $1.08 trillion. This region played a crucial role in Bitcoin’s run to $65,000 in early 2021, and the resistance levels that were in play back then are in play again:
The total market cap has threatened to break above this key level of $1.08 trillion twice in the past two weeks or so, but on both occasions it has failed to maintain any momentum and stay above it. It does look however to have potentially turned the bottom of the region into support for a more concentrated push upwards, as indicated by the yellow box:
As we saw back in 2021 however, when Bitcoin got rejected at $42,000 and dropped back to $28,700, if it can’t maintain upwards momentum we may see a pullback across the board back to the $870 million range, which in Bitcoin’s case would take us back to $19,000 again.
A worse case scenario could also be playing out for the crypto market, which could be that the current rally is just another stage in a year-long pullback:
For Bitcoin, this would mean a return to $12,000-$14,000, something that would be a nightmare for some and a dream come true for others.
To avoid such a scenario we need to see the total market cap break that $1.08 trillion area and successfully re-test it as support. Only then can we be confident that the good times might keep rolling, for a little while longer at least.