Benzinga - Bitcoin (CRYPTO: BTC) experienced a surprise drop after reaching all-time high levels, with analysis from 10x Research pointing out future support levels if the drop were to continue.
What Happened: Reiterating its earlier cautious stance on Bitcoin, the digital asset firm cautions investors of “fragile” market segments and potentially volatile returns following Bitcoin's “outside day.”
An "outside day" refers to reaching a new high and trading below the previous day's low within the same trading session.
Bitcoin’s ‘Real Test’
Bitcoin faced challenges in sustaining its rally during U.S. trading sessions despite robust ETF inflows and continued buying from BlackRock clients.This was accompanied by a surge in meme coin trading, with Shiba Inu emerging as the most traded coin in Korea for seven consecutive days.
The market experienced historically low inflows, indicating “Bitcoin is going to experience a real test.”
The report suggested Bitcoin might undergo a more profound and prolonged correction and “could decline to 63,000 as a potential target before resuming its upward trend.”
Also Read: Bitcoin Bloodbath: Digital Gold Loses Its Luster, But Are Investors Shaken Or Shopping?
Ethereum Surge, “Reality Check”
Ethereum (CRYPTO: ETH) experienced a recent surge driven by the Dencun upgrade.But, the current valuation appears disconnected from fundamentals. It is now facing a reality check, as “it returns to fundamental weaknesses in revenue growth.”
The prospects for an Ethereum ETF approval have dropped to as low as 30%, contributing to the sell-off in prices and dragging Bitcoin further down.
Additionally, research indicates MicroStrategy is trading 60%-90% above fair value, whether assessed through regression against Bitcoin or based on Bitcoin holdings.
Market sentiment was further impacted by factors such as U.S. and Europe inflation data and speculations on potential rate cuts. These developments left investors curious about the next moves for Bitcoin.
Read Next: Bitcoin Rally 'Is Over': Crypto Trader Points To These 'Sufficient Reasons' Why Top Is In
Photo: Shutterstock
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.