Leading cryptocurrencies came under significant pressure on Thursday as traders moved away from riskier assets following recent market advances. Bitcoin slipped below the $90,000 mark in early trading sessions but rebounded slightly to hover around $91,000 by late afternoon. The trading volume surrounding Bitcoin remained relatively stable over the past 24 hours, indicating moderate market participation.
Ethereum combined a downward trajectory with a fluctuation near the $3,100 level, unable to build substantial momentum despite recent gains. Other tokens such as XRP and Dogecoin also failed to break upward, registering losses of approximately 2.14% and 3.04%, respectively. Meanwhile, Solana demonstrated resilience by posting a gain of 1.29%, trading near $138.58.
Market-wide liquidations in the cryptocurrency sector surpassed $400 million within the last 24 hours, signifying a sharp contraction in bullish bets. Notably, about $320 million tied to long positions were wiped out during this adjustment period, as reported by Coinglass. Conversely, Bitcoin shorts totaling over $450 million on Binance are teetering on potential liquidation risk if the flagship cryptocurrency reclaims the $93,000 threshold.
Bitcoin's open interest decreased modestly by 0.55% in the 24-hour period but has nevertheless shown an 8% rise since the beginning of the year, emphasizing ongoing investor engagement despite volatility.
Cryptocurrency Market Capitalization and Movers
The aggregate valuation of the global cryptocurrency market dropped by 1.87%, settling around $3.13 trillion. Some standout gainers within mid-to-large market cap coins include ISLM with a remarkable surge of over 430% to $0.05138, pippin climbing nearly 29% to $0.3644, and DeepBook Protocol appreciating 15.44% to $0.0498. These developments point to selective interest in certain projects amid broader market weakness.
Stock Markets and Commodity Prices Advance
U.S. equities countered the broad risk-off sentiment prevalent in cryptocurrencies by posting gains. The Dow Jones Industrial Average advanced 270.03 points or 0.55%, concluding the session at 49,266.11. The S&P 500 edged higher by 0.01% to close at 6,921.46, whereas the technology-centric Nasdaq Composite index declined marginally by 0.44%, settling at 49,266.11.
Defense stocks notably outperformed following public remarks by former President Donald Trump advocating for an increase in the 2027 military budget from $1 trillion to $1.5 trillion. Lockheed Martin Corporation's shares rose 4.34% while Kratos Defense & Security Solutions delivered an even larger jump of 13.78%, signaling investor optimism tied to heightened defense spending expectations.
Simultaneously, crude oil experienced an upward correction with West Texas Intermediate crude futures increasing by 0.87%, trading near $58.26 per barrel, reflecting broader commodity market strength amid fluctuating global demand and supply dynamics.
Technical Concerns and Analyst Perspectives on Cryptocurrencies
Blockchain analytics firm CryptoQuant pointed to a downward trend in the Market Value to Realized Value Ratio (MVRV), an indicator measuring market valuation relative to historical prices. The MVRV ratio's failure to sustain elevated levels near historically recognized overvaluation zones suggests subdued momentum. CryptoQuant cautioned that unless this ratio stabilizes and rebounds, the trajectory is more likely to favor cooling momentum instead of renewed strength, highlighting ongoing uncertainty in the crypto market.
Noted cryptocurrency trader and analyst Ali Martinez underscored the importance of Bitcoin maintaining its price above $87,200 to prevent a slide toward approximately $69,230. Martinez further analyzed Ethereum's chart patterns, projecting a potential target near $3,730 derived from an ascending triangle formation, indicating moderate upside potential amid the current consolidation phase.
Overall, these assessments underscore a cautious environment where Bitcoin confronts a critical support threshold while Ethereum exhibits chart-based bullish signals, conditions that market participants are monitoring to gauge the next directional moves in digital assets.
Key Points
- Major cryptocurrencies including Bitcoin, Ethereum, XRP, and Dogecoin declined as investors trimmed their risk exposure after recent gains.
- Bitcoin traded near $91,000 following an intraday dip below $90,000, with stable trading volumes and slightly reduced open interest.
- U.S. stock indices mostly advanced, led by the Dow Jones, while crude oil prices improved, reflecting divergent risk sentiment between asset classes.
- Analysts highlight the necessity for Bitcoin to hold above $87,200 to prevent a substantial pullback and observe for Ethereum's ascending triangle which may target $3,730.
Risks and Uncertainties
- Bitcoin's failure to sustain levels above $87,200 risks a significant price correction potentially toward $69,230.
- Continued liquidation pressures in the cryptocurrency market reduce bullish momentum and may contribute to further volatility.
- The MVRV ratio's downward trend signals potential overvaluation reversion, posing risks for short-term price stability.
- Volatility in tech stocks and external factors such as military budget policy could impact market sentiment and capital flows across sectors.