On Tuesday, the cryptocurrency market sank even further as the strong upward movement of the US dollar put pressure on financial markets around the world. The dollar tried to retest its 20-year high.
As a result of the strengthening dollar, Bitcoin (BTC) fell below the psychologically important support at $20,000 to hit a daily low of $19,542, where the bulls frantically refocused in an attempt to prevent further declines.
According to senior market analyst Jim Wyckoff, the bulls lack strength as they try to stabilize prices and break the downward trend that is still present on the daily chart. However, this may turn out to be more difficult than expected because the bears still have an overall near-term technical advantage.
According to analyst firm Glassnode, the scale of capital outflows over the past month is historic. Only the 2018 capitulation led to more outflows, with the relative magnitude of investor losses reaching 0.28% of market capitalization per day in recent weeks.
Not all traders in the market are pessimistic about the prospects for BTC moving forward, including market analyst and Twitter user Rekt Capital, who noted that it has only been 300 days since Bitcoin's $68,000 peak, meaning this bear market is nearing its end.
According to Rekt Capital, BTC bear markets tend to find their absolute bottom price around 365 days after the previous peak.
Perhaps the pain that many market participants are experiencing is a sign that it is time to start accumulating. To follow Warren Buffett's famous advice, "be fearful when others are greedy and be greedy when others are fearful," you should start saving.
Ultimately, it is unknown which way the market will go in the near future, staunch supporters of the cryptocurrency continue to assume that the opportunity to purchase BTC somewhere around $20,000 is a deal for life, which will eventually turn out to be a timely bet.
Currently, the total market capitalization of cryptocurrencies is $956 billion, and the Bitcoin dominance rate is 39.3%.
