According to the details, this year’s bearish market trend is the worst in history for BTC and other coins. The data shows that panic selling by BTC traders is common even when they suffer losses.
Digital currencies are marked by volatility. Unfortunately, it’s a trend that could cause most inexperienced investors to suffer huge losses of funds with their crypto holdings. A bear market can be triggered by many factors. Although some players might use a bear trend as a way to increase their portfolio of crypto assets, it is not profitable.
It seems that the 2022 market is taking the most severe historical turn. Glassnode, which is a Blockchain analysis company has given a dismal view of the 2022 bear markets. The firm also identified many contributing factors to the current crypto market price fall.
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According to the analytic firm, crypto market trends were tagged “A Bear of Historic Proportions”. The report, released on Saturday, explained how Bitcoin’s price fall pointed to 2022 as the worst year for BTC.
The following are some of the factors that will determine the bearish BTC trend for 2022:
- Bitcoin’s methodic drop beneath the moving average (MA) of 200 days.
- Cumulative realized losses.
- Positive shifts in BTC realized price
Glassnode records show that ETH and BTC prices fell below their all-time highs. This plunge is unprecedented in cryptocurrency history.
Glassnode reported that the 2022 bear market was severe as BTC dropped below the 200-day MA. Notably, the first and apparent red alert of a bear market is the fall of BTC’s spot price beneath the 200-day MA. It could also go above the 200-week MA if the situation is critical.
BTC Prices Fall Below 0.5Mayer Multiple, MM
Analytic firms also showed extreme conditions for the crypto bearish market, with spot prices falling below realized prices. With the situation’s outturn, many traders are selling off their crypto tokens even as they make losses.
Glassnode’s illustration revealed that BTC fell below 0.5MM (Mayer Multiple). It is the lowest price drop to this point since 2015. Usually, the MM is a measure of price changes when it’s above or below the 200-day MA.
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The implication means over-buying if it’s above or overselling below. The company data shows a MM of 0.48 for the 2021-22 cycle, compared to 0.511 which was the lowest ever recorded.
The firm maintained that this is a historic occurrence as it’s uncommon for spot prices to go below the realized price. After analyzing all of the negative value in crypto markets, the firm concluded that market is now at a point where it can no longer be sustained.
Pexels' featured image and charts by TradingView.com/Glassnode