The crypto markets are trading relatively flat after an incredibly volatile trading session yesterday, where many altcoins dropped 10% or more as Bitcoin failed to stabilize above the $4,000 price region.
It now appears that the crypto markets are forming fresh trading ranges, and analysts agree that further losses could be right around the corner.
Bitcoin Finds Support Around $3,600
Although the recent drop did appear to be negative for Bitcoin’s price, as it signaled that bulls did not have enough buying pressure backing them to push the cryptocurrency’s price above $4,000, there was not enough selling pressure to push its price below the $3,600 region, which has so far acted as a level of support.
At the time of writing, Bitcoin is trading up approximately 1% at its current price of $3,700, up slightly from its 24-hour lows of $3,650.
Because Bitcoin has found some support near its current price levels, it is becoming increasingly apparent that it has formed a relatively tight trading range between approximately $3,550 and $4,200.
Mati Greenspan, the senior market analyst at eToro, discussed this tight trading range in today’s market update, further noting that Bitcoin is still caught in a significantly larger trading range between $3,000 and $5,000.
“As we’ve been discussing since mid-November, the current range is from $3,000 to $5,000… It seems now, that bitcoin has opened a new mini-range within that from $3,550 to approximately $4,200… Movements within a range can sometimes be sudden like we saw yesterday, but unless there’s a breakout of the key levels there really isn’t much to write home about,” he said.
Furthermore, Greenspan also noted that it is expected that movements within the small trading range will be large likely because of a “lack of liquidity” mixed with “large orders being placed on exchanges.”
DonAlt, a popular cryptocurrency analyst on Twitter, recently shared his thoughts regarding Bitcoin’s drop, claiming that he is currently sitting out of Bitcoin until it further establishes which direction it is going to head over a longer period of time.
“Well, finally got some volatility just not in the direction I would’ve preferred. Glad I trusted my system and waited for the weekly close. Still sitting out Bitcoin wise,” he said.
Another popular cryptocurrency analyst on Twitter, BrotoshiMoku, shared his thoughts regarding where Bitcoin’s price is heading next, saying that if Bitcoin forms another leg down, it will likely head to the $3,400 region.
Altcoins Trade Up Slightly as Crypto Market Stabilizes
The altcoin markets have recovered slightly from their recent lows, but are having an overall mixed trading session today.
At the time of writing, Ethereum is trading up approximately 1% at its current price of $128.40. Ethereum has failed to overtake XRP by market capitalization, and is currently behind XRP’s market cap by roughly $400 million.
“ETH could be real cheeky and go for that gap fill at ~$99. Now that would be an entry,” he said.
XRP is currently trading up 2.25% at $0.337, and is up slightly from its daily lows of $0.327.
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