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Over the last weekend, Bitcoin (BTC) and the broader crypto market witnessed a brutal sell-off with Bitcoin and the broader crypto market losing nearly 10%. In the last three days, the broader crypto market has eroded $250 billion of investors’ wealth.
The world’s largest cryptocurrency Bitcoin (BTC) has slipped under $33,500 as of last week’s closing. Twitter handle Blockchain Backer says that Bitcoin losing its crucial support of 100-day moving average (DMA) can lead to further sell-off. The crypto analyst explains:
“Bitcoin closes the week below the 100-week moving average. Both previous times led to capitulation to 200-week moving average in 2014 and 2018. Today’s chart has many differences from those two times, and those two times were very similar to each other. Big dive in tomorrow!”
On-chain data provider Santiment further explains that the trader sentiment has dropped to negative levels once again. It states: “With #Bitcoin now having retraced all the way down to $33.9k, trader sentiment has fallen to six week lows. We typically prefer to see capitulation signs like this, as weak hands leaving the space is generally what is needed for a truly notable bounce”.
With today’s correction, the BTC price is down nearly 30% year-to-date.
Altcoin Market Sell-Off, LUNA Crash
Ethereum (ETH) continues to follow Bitcoin closely and the ETH price has now slipped under $2,500 approaching the 2022 low of $2,200.
Over the last week, Terra faced major price correction with the price of LUNA tanking 20% in a single day amid the major sell-off for its UST stablecoin. The concerns of a de-peg featured as the price of UST stablecoin was pushed under $1.0. As crypto analyst Colin Wu explains: “The circulating supply of LUNA increased by 957,201 in a single day, reaching 91.357 million, setting a new record for the circulating supply of LUNA in a single day since April 8”.
The Luna Foundation is reportedly working on measures to protect the UST peg of Bitcoin.
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