After another big selloff, Bitcoin fell below its support zones and now trades around its annual open. The #1 cryptocurrency by market size is currently trading at $29,605, down 11.2 percent on the weekly chart.
Except for a few coins, the crypto market has followed Bitcoin, and the top 10 currencies have suffered more significant losses.
BTC and other major cryptocurrencies have been in the red for three months in a row. Two capitulation incidents occurred in May and June, pushing BTC’s price below its current levels. As a result, many investors and traders believe the market will continue to fall as it consolidates a third and perhaps final collapse.
Ethereum (ETH) outperformed Bitcoin in the weeks leading up to the most recent collapse (BTC). The second-largest cryptocurrency in terms of market capitalization climbed from approximately $1,600 to $2,390 before reverting to current levels.
However, according to a new analysis by Arcane Research, BTC is still the strongest performer in the crypto industry. As a result, the BTC Dominance has risen as altcoins’ support levels have been pushed lower.
By the time the study was published, Bitcoin had a 46.92 percent market share, with Ethereum coming in second with 16.96 percent. USDT (5.12 percent), BNB (3.72 percent), and ADA (2.86 percent) are vying for spots against XRP (2.05 percent) and DOGE (1.82 percent).
Since the beginning of July 2021, Bitcoin has retraced about 11.2 percent, according to the chart. Cryptocurrencies with high market capitalization had the least severe declines, falling by only 18.5 percent, followed by small-cap tokens, which fell by 19.6 percent. With a 22.4 percent loss, mid-cap cryptocurrencies suffered the greatest hit. According to Arcane Research,
(…) All indexes have now seen considerable negative monthly returns three months in a row. In May, all indexes saw negative returns of around 30%. In June, the monthly returns ranged between -5% for bitcoin to -28% for the Small Cap Index. This month, we’re currently on the path towards another month of substantial negative returns for the broad crypto market.
The Open Interest in Bitcoin Derivatives is Increasing.
The 7-day chart of Arcane Research likewise showed a decrease in volatility. This statistic was 1.68 percent at the time. The last time Bitcoin’s volatility was this low was in October 2020.
Open Interest in BTC-based derivatives, on the other hand, has increased (OI). Bitcoin futures have had a significant impact on the market’s dynamics. When BTC went down in price, the first capitulation event was anticipated by a high OI and a rise of liquidations.
With 395,000 BTC, this measure was on the fall but is now approaching April and May highs, according to Arcane Research. Since the end of May, when OI was at its lowest, it has risen by 95,000 BTC.
The market might see further volatility in the coming weeks as the Bitcoin hashrate recovers and Ethereum’s EIP-1559 is implemented with the London Hardfork.
