Crypto Market Faces Strong Sell-Off: What’s Next?
Bitcoin and most altcoins are experiencing a notable sell-off. The Altcoin Season Index has dropped from 80 to 41,indicating a shift in market sentiment.
Bitcoin briefly dipped below $104,000, while altcoins like Ethereum and Ripple are in a bear market. The total market cap of cryptocurrencies, excluding Bitcoin and stablecoins, has fallen from $1.5 trillion to $1.1 trillion.
This crash is due to rising liquidations and panic selling. The Fear and greed Index has moved to the fear zone. Trade tensions between the US and China have also contributed to the decline.
Will the crypto market recover? There are reasons to beleive it will. The Altcoin Season Index usually triggers a rebound when it falls below 25. With the index at 41, a further drop and subsequent recovery is possible.
Potential catalysts for a rebound include the end of the government shutdown, leading to the approval of altcoin ETFs. Strong earnings from American companies could also boost the market. Historically, Bitcoin and altcoins have recovered after steep declines.
The Federal Reserve’s rate cuts to support the economy could also benefit the crypto market. These factors suggest a possible recovery in the coming weeks or months.
