After a week of widespread bloodshed in the cryptocurrency markets, the markets have continued their descent into their mid-2017 levels on Monday, with Bitcoin leading the markets down as it sets fresh 2018 lows.
Bitcoin Drops to New 2018 Lows, But All Hope is Not Lost
At the time of writing, Bitcoin (BTC) is trading down 13.5% at its current price of $4,850, and further losses could be on their way. As noted in last Thursday’s market update, prominent technical analysts noted that today’s drop was highly likely, mainly due to it being unable to decisively breach through the $6,500 level.
“After the recent attempt to clear $6,500 bitcoin has lost all its momentum and now we are seeing some very bearish signals,” Naeem Aslam, the chief market analyst at Think Markets U.K. said last week.
Earlier today, Stephen Innes, the head of Asia Pacific trading at Oanda, told MarketWatch that Bitcoin’s drop below $5,000 was incredibly likely, and its drop below this level could open the gates for even further losses.
“I remain incredibly bearish on BTC with the $1,000 level looking as likely as $10,000. But this is from a longstanding and unwavering view that regulators and the banking system will continue to push back against the rise of virtual markets, and will undoubtedly burst crypto’s balloon as the $5,000 cliff edge is approaching fast,” he said.
Although the cryptocurrency bloodbath appears to be unprecedented, it is important to note that this has happened before on multiple occasions, and that each plunge was proceeded by parabolic gains.
In a recent tweet from Charlie Bilello (@charliebilello), the director of research at Pension Partners, a NYC-based asset management firm, he highlighted that Bitcoin’s drop from its December 2017 highs to its current lows is actually only BTC’s fifth largest drop, although this figure is based off of Bitcoin’s price being $5,165, and at its current price it is currently in its fourth largest pullback.
XRP Holds Steady, Critics Flip to Proponents
Although most altcoins are trading down well over 10%, XRP has been holding steady and is currently only trading down 3.2% at its current price of $0.488.
XRP has nearly recovered all of its losses from last week’s market drop, when its price fell to lows of $0.42. The altcoin’s stellar performance despite a persisting downward trend in the cryptocurrency markets have led some prominent crypto-Twitter personalities to change their views on it.
Ran NeuNer, the host of CNBC’s Crypto Trader, was a notable critic of XRP in the previous months, echoing widespread criticism regarding the potentially centralized nature of the cryptocurrency.
Despite being a critic, he has now changed his tone on XRP, saying:
“I’ve made a lot of REALLY bad calls in the bear market but none as bad as the day I said that I would throw XRP in the garbage!”
How well the markets perform over the coming few days will signal whether or not the latest drop is simply capitulation, or if it signals that further losses are to come.