Bitcoin and Ethereum Face the Bears in Short-Term Correction

[Donken]

Bitcoin and Ethereum Face the Bears in Short-Term Correction

Bitcoin and Ethereum fell dramatically in the past 24 hours. Though prices have returned to pre-crash levels, multiple technical indicators suggest the worst is yet to come.

Bitcoin took a 6% nosedive in the last 24 hours that saw its price drop below the $18,000 mark for the first time in over a week.

The pioneer cryptocurrency was able to rebound significantly, regaining the $18,300 level as support. Although the recent bullish impulse looks promising, several indicators suggest that BTC will continue to fall.

One reason behind the bearish tumble is Mt. Gox exchange’s upcoming distribution of nearly 140,000 BTC to victims of the platform’s shutdown in 2014.  Due to Bitcoin’s price appreciation since then, it is reasonable to assume that many recipients will sell their newly-received tokens on the open market.

A $3 billion injection of Bitcoin could be the catalyst that ignites the next major correction.

When considering that some of the so-called “whales” have been offloading their coins since Nov. 18, the potential spike in selling pressure may have the strength to push prices lower.

Santiment’s holder distribution chart shows that the number of addresses holding 10,000 to 100,000 BTC has dropped significantly. Roughly seven whales have left the network or redistributed their tokens, representing a 2.7% drop over a short period.

The decreasing number of Bitcoin whales on the network may seem insignificant at first glance. However, these large investors hold between $183 million and $1.83 billion in BTC. Thus, the downward pressure from these users is significant.

If the selling spree continues, Bitcoin might be bound for a steep retracement.

The TD sequential indicator adds credence to the pessimistic outlook. This technical index recently presented a sell signal in the form of a green nine candlestick on BTC’s 1-month chart. The bearish formation forecasts a one to four monthly candlesticks pullback before the uptrend resumes.



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[Fenix]

Not a very good outlook for the near future in the cryptocurrency market.  There was also information that Chinese law enforcement agencies seized a large amount of cryptocurrency, including bitcoins and ethereum, for a total of about $ 4.3 billion.  If this cryptocurrency is forcibly sold by a court decision, then a large drop in prices in the market cannot be avoided either.  Let's still hope that this will not happen and the market will be able to avoid large price losses of our cryptocurrencies.