Crypto traders are agitated. Their emotions can be seen in their trading pattern. When the crypto market is pumping, demands grow bigger and bigger. This is pushed by Fear Of Missing Out (FOMO).
In the last few days, this has been evident with Bitcoin. While cryptos have been pumping, daily trading volume has been hitting the roof. Despite the hype around Bitcoin turning strongly bullish, the asset has failed to break above $10,400.
A rejection at this position has seen the digital asset retrace to the $10,150 level. Predictably, this has seen some panic set in. Many investors believe that this is a sign the market is not ready and is yet to turn strongly bullish. For altcoins, a market panic could mean a price bloodbath with the coins taking the heavy beating.
Already, a number of altcoins have followed Bitcoin into the red zone. Bitcoin SV and Tezos have been hit worst dropping by more than 7%. Other coins are recording marginal drops of around 2%. Those still in the green zone like XRP, Litecoin and Ethereum have slowed down with the highest gainer being XRP with a gain of just over 8%.
Although the altseason is hereabouts, with Bitcoin still holding a market dominance of more than 60%, its movement will continue to dictate the way forward. If this dominance breaks below this, then we can see altcoins forge their own paths regardless of Bitcoin’s trend.
Bears Are Not In Yet
Bitcoin’s rejection at $10,400 isn’t a bearish sign. This just means the asset climbed too high too fast and further consolidation is needed below this and a higher support set. With the drop seeing Bitcoin trade above $10,100, the asset is above strong support.
Some analysts suggest that a drop to $9,800 would make for better consolidation. However, this comes with considerable risk. Investors could panic and trigger a major market sell-off.
Investors’ sentiments will continue to influence their trades. The bulls need to protect the $10K support and avoid a market panic. Above the $10K psychological position, investors are unlikely to sell and FOMO will continue to bring in new investors. With this, soon enough Bitcoin could climb back to break above $10,400.