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08.09.2020 04:25 PM
Bitcoin and Altcoin prices start downside correction

It is scary to imagine, and even more scary to see a correction of 30, 40 and even 70% from the peak level, but this happens when you trade Altcoins via hype. And this moment came, the cryptocurrencies entered the red zone

With the onset of autumn, the market has dramatically changed, the hype of decentralized financial applications [DeFi-Decentralized Finance] like a vacuum cleaner dragged an enormous amount of money into the market, which led to large profits from cryptocurrencies. Income from 500% to 1,000% was something normal for DeFi as assets were growing and millions of new participants were entering the marker. Each of the new market participants wanted to get what mass media was writing about. It was an enormous profit from cryptocurrencies. Every day, the market was becoming more and more overheated. However, the DeFi bubble was also rising and finally reached $9.51 billion on September 2.

The day of judgment came, Altcoins dropped losing half of their value. Hamsters are in a panic, and only Bitcoin owners are not really scared. The first cryptocurrency went into correction, losing 15-20% of the peak level, which is still within the acceptable range.

Example

From September 2, Bitcoin has lost about 18% ($12,000 ---> $9,800), while Altcoin YFI for the same period of time, slumped by 45% ($32,500 ---> $18,000).

In order to recover to the levels logged on September 2, Bitcoin needs to advance by 22%, and Altcoin needs a rise of 80%.

The first cryptocurrency confirmed its title of a conservative crypto asset that can be invested in with less risk of drawdown.

The recovery process is expected to be difficult, the crypto market has an impressive correction, and it will take several weeks or even months to recover. Do not be discouraged, there are plenty of drivers for growth. For example, the upcoming IPO of Coinbase, which may encourage investors to take action. At the same time, we expect the early launch of large-scale crypto project DFINITY, which will push the community to a new level in digital development thus attracting new investors and boosting the crypto market.

Correction is not just stress, it is an opportunity to buy an asset at a discount.

You can set filtering of market leaders on coinmarketcap: TOP 10/15/25.

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Current development of Bitcoin and its prospects

The quote is at the correction stage, where the psychological level of $10,000 is trying to keep market participants from further decline. Now, everything depends on the depth of fear and the spillage of the entire market, since the maximum correction for Bitcoin is $8,500, but this will be discussed if the price is fixed lower than $9,500.

Life hack

If Bitcoin declines to the level of $8,500, Altcoins will lose another 30-60% of the current value without any brakes.

A positive scenario considers the appearance of a flat formation on the market in the range of $9,800/$11,500, which will provide an opportunity to recover all crypto assets. The sideways movement will be the best scenario, which in the future may boost Bitcoin as well as the entire crypto market.

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General background of the crypto market

Analyzing the total market capitalization of the crypto industry, you can see that Total market lost $70 billion just in a few days and currently stands at $323 billion.

The correction is everywhere, if we look at the volume chart in general terms, then first we need to return to the highest level of $385 billion logged in 2019 , which will reflect the recovery of the bullish trend. Then we will update the current maximum of $393 billion. After that, the price may return to the range of $245 billion / $285 billion.

Market Cap: $323,621,210,798

BTC Dominance: 57,4%

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The index of emotions of the crypto market was stable above 80 points on September 2, but now it decreased by almost one half and it is at 41 points. The fear of a crash is not yet reflected in the index figures, but many traders/hamsters are in a panic, which has a detrimental effect on crypto assets.

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Indicator analysis

Analyzing different sectors of timeframes (TF), it is clear that the indicators of technical instruments signal selling due to the correction stage. The weekly period holds the buy signal, reflecting the general trend of 2020.

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Gven Podolsky,
Analytical expert of InstaForex
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