Why the Crypto Market Is Down Today
The crypto market cap (TOTALCAP) and the Bitcoin (BTC) price negated most of their gains by falling sharply yesterday. Compound (COMP) is approaching a key support level at $58.
Binance and its CEO Changpeng Zhao are on the receiving end of a US court summons in June. There are rumors that fraud charges will be filed against the exchange.
Crypto Market Cap (TOTALCAP) Negates Yesterday’s Gains
The TOTALCAP has fallen since its $1.24 trillion high on July 13. The decrease led to a low of $1.11 trillion on August 1.
The price bounced afterwards, creating a bullish candlestick (green icon) and validating the $1.12 trillion area as support. However, the bounce was short-lived, since the price negated almost all of its gains the next day.
TOTALCAP now trades inside the $1.12 trillion area again.
If the price bounces again, it can increase by 9% to $1.24 trillion. However, if a breakdown transpires, a 5% drop to the 1.08 trillion support area will be likely.
Bitcoin (BTC) Price Faces Rejection Despite Breakout
The price of BTC has been following a descending parallel channel after reaching its highest point of the year at $31,800 on July 13. This decline reached a low of $28,585 on Aug. 1.
However, the price then rebounded, confirming the channel’s midline as a support level. As channels are considered corrective patterns, the most probable scenario ahead was a breakout from this channel.
Despite the breakout, BTC was rejected by the $29,800 resistance area yesterday and negated most of its gains. It now risks falling back inside the channel.
If it does, a drop to the channel’s support line at $27,200 will be the most likely future price scenario. This will amount to a drop of 6.50%. However, if BTC bounces, it can make another attempt at clearing the $29,800 resistance area.
Compound (COMP) Price Falls to Support
The COMP price has fallen since reaching a new yearly high of $85.90 on July 16. The decrease led to a low of $58.29 nine days later. While the price bounced afterwards (green icon), the bounce was short-lived and COMP is trading inside the $58 area again.
Whether it bounces or breaks down could determine the future trend.
A bounce will likely catalyze a 45% increase to its yearly highs near $85. On the other hand, a breakdown will likely take the price back to a descending resistance line at $45. This will amount to a drop of 24%.
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Disclaimer
In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions.
