Bitcoin, Ethereum, XRP, and Dogecoin prices decline as crypto market enters August. What is causing the sell-off?
Cryptocurrencies like Bitcoin, Ethereum, XRP, and Dogecoin experienced a significant drop in value during the US pre-market hours on Friday. Bitcoin, the leading cryptocurrency, saw a more than 3% decline, causing other major altcoins to follow suit. Ethereum, Cardano, Solana, and XRP all experienced price drops amidst a wave of market volatility.
Bitcoin, which closed July at its all-time high monthly close, faced a shaky start to August as its price tumbled to $114,870. The cryptocurrency market was further impacted by President Donald Trump’s trade deal deadline expiring on Friday and the dollar index rising above 100. Bitcoin’s price briefly dipped to $114,322 before recovering.
The market’s volatility led to significant liquidations totaling $756.71 million over the past day. Long bets, where traders anticipated price increases, made up the majority of liquidations, amounting to around $100 million. Short liquidations followed at approximately $55 million. Among major cryptocurrencies, Ethereum took the biggest hit in liquidations at $227 million, with Bitcoin close behind at $179 million.
The overall cryptocurrency market’s valuation dropped by 7.7% over the past day, reaching $3.82 trillion. Notable cryptocurrencies like Dogecoin, Cardano, and Solana experienced more than a 6% decline. Ethereum’s price fell by 5.3%, with XRP following suit with a 5.5% dip.
Analysts pointed out that Bitcoin filled a crucial “gap” in CME’s Bitcoin futures from July, which could signal a potential upward movement. Crypto investors and entrepreneurs like Ted Pillows and Cipher X predicted positive price action post-gap filling. However, trader Cipher X also highlighted a potential downside target of $104,000 if $116,000 was not reclaimed.
Despite the short-term fluctuations, experts like crypto trader Michaël van de Poppe remain bullish on the longer-term outlook. Van de Poppe encouraged investors to accumulate positions for the next market run, hinting that August might be a month of stabilization leading to upward movements in altcoins and Bitcoin.
Retail traders on Stocktwits reflected cautious sentiment, with a shift towards ‘bearish’ territory over the past 24 hours. Concurrently, cryptocurrency-related stocks also faced losses during pre-market sessions. Companies like MicroStrategy (MSTR), Riot Blockchain (RIOT), and Coinbase Global (COIN) experienced dips in their stock prices, reflecting broader market volatility.
In light of recent events and market trends, it is crucial for investors to closely monitor the cryptocurrency market’s movement and potential catalysts driving further price fluctuations in the coming days.
