Painful 24 Hours for Crypto

GB Market Commentary 20/07/2021 by Will Morris

Overnight Bitcoin crashed through the $30,000 psychological support line, falling to $29,577, confirming predictions that Bitcoin has been on a trajectory to break through the critical support level. This is the first time Bitcoin has broken the $30,000 support range since June 22nd, furthering the downtrend witnessed over the past few months. A key level of support has been indicated around the $28,700 level, just below June’s low of $28,794. Institutions and whales may be targeting this as a key entry point to engineer liquidity, entering positions just under the low, as many traders will have stop losses resting there. If this level is broken some predict Bitcoin could fall into the mid $20k region, where there has previously been consolidation.

One factor contributing to Bitcoin’s recent downfall could be attributed to the dollar, which is showing aggressive strength. When this occurs all markets usually experience a correction. If the dollar continues to rise, Bitcoin may be hurt further. In addition to this, the acceleration of Bitcoin’s sell off has been attributed, by some, to BlockFi receiving a Cease and Desist order (a document sent to an individual or business to stop allegedly illegal activity). The New Jersey securities regulator claims the firm has been offering unlicensed securities, causing fear to spread surrounding mounting regulatory pressure. The Delta variant also appears to be a a significant factor in yesterday’s retreat of the global stock market as fears mount around its rapid spread, whilst equities have seen a small bounce back today.

Coindesk News commented yesterday that in the options market there is continued demand for put options as investors look to add downside hedges against long positions. Data from CoinMarketCap shows that almost $100bn was wiped off the crypto market overnight, confirming investor inclinations to be fearful.

Ethereum also saw profound losses dropping 9%, just two weeks before the rollout of EIP- 1559, currently trading at $1739. BNB, Cardano, XRP and Dogecoin were all hit with double digit losses, compounding fears of deeper price declines across the crypto market. All of which furthers the bearish sentiment that pervades the market and strengthens claims that the super cycle has been paused in the near term, at least.

In positive news, GlobalBlock are excited to announce that we are now a wholly owned operating subsidiary of Helix Applications which will soon become GlobalBlock Digital Asset Trading. This means that GlobalBlock has become part of a public company listed on the TSXV. David Thomas, Chief Operating Officer said, “We are hugely excited to complete this business combination, which allows us to continue to focus on our growth and development within the digital asset space, making us well placed to become the number one digital asset broker within the UK market and beyond.”