Why Is the Crypto Market Down Today?

The Total Crypto Market Cap (TOTALCAP) risks breaking down from an ascending parallel channel, while the Bitcoin (BTC) price validated its channel as resistance. Render Token (RNDR) was rejected by the $2.17 resistance area.

In the news, Three Arrows Capital (3AC) co-founder Kyle L. Davies was criticized by liquidators for failing to comply with a subpoena.

Crypto ATM operator Cash Cloud filed for chapter 11 bankruptcy. And Robinhood published its financial results for 2022, revealing that it missed its earnings and revenue expectations.

TOTALCAP Risks Breakdown

The crypto market cap (TOTALCAP) has traded in an ascending parallel channel since Jan. 23. These channels are considered bearish patterns, meaning they lead to breakdowns most of the time.

After rejection by the channel’s resistance line on Jan. 29 (red icon), the TOTALCAP continued to consolidate inside the channel before falling to the support line once more on Feb. 9. This is a sign of weakness that suggests a breakdown will occur.

If a breakdown occurs, TOTALCAP could fall to the 0.382 Fib retracement support level at $935 billion. On the other hand, a breakout could take TOTALCAP to the next resistance at $1.14 trillion.

Since the bearish divergence trend line in the RSI (black line) is still intact, a breakdown is more likely than a breakout.

TOTALCAP/USDT Six-Hour Chart. Source: TradingView

Bitcoin Validates Channel as Resistance

The BTC price has traded in an ascending parallel channel since Jan. 23. After rejection by its resistance line on Feb. 2, the price broke down on Feb. 6. Then, it validated it as resistance the next day before resuming its downward movement (red icon).

Due to the breakdown and validation as resistance, the continuation of the decrease is likely. If so, the Bitcoin price could fall to $20,930, the 0.382 Fib retracement support level.

On the other hand, reclaiming the channel would invalidate this bearish outlook and suggest that the Bitcoin price could increase to the channel’s resistance line at $24,800. Currently, this seems unlikely.

BTC/USD Six-Hour Chart. Source: TradingView

Render Token Rejected by Crucial Resistance

The Render Token price has increased since breaking out from the $1.05 resistance area on Jan. 28. The upward movement led to a high of $2.19 on Feb. 7.

However, the RNDR price was rejected by the $2.17 resistance area and created a bearish engulfing candlestick. If the downward movement continues, the price could fall to $1.05 again. On the other hand, a breakout above $2.17 could lead to an increase toward $3.

RNDR/USDT Daily Chart. Source: TradingView



Show More

Become a Millionaire by Trading Crypto!