On Sunday, the cryptocurrency market shifted from calm to explosive, with Bitcoin (BTC) prices on the Binance platform soaring to $107,114 at one point. This surge caused the cryptocurrency market cap to drop by 2.7% to $3.36 trillion. Ethereum (ETH), Dogecoin (DOGE), and Ripple (XRP) fell by 4.7%, 0.9%, and 1.1% respectively over the past 24 hours.
CoinGlass data shows that over the past 24 hours, as Bitcoin prices fluctuated between $107,000 and $102,000, positions worth $651 million were liquidated.
Why did Bitcoin (BTC) crash today?
From a technical perspective, Bitcoin prices briefly broke above last week's high of $105,663 but then faced significant selling pressure from position demand. This led to a drop in Bitcoin prices of 4.23% from the new high of $107,114 to a local low of $102,579.
As previously mentioned, BTC may drop to the $100,000 to $99,000 range, which is a key support area.
Why did ETH, XRP, and DOGE prices drop today?
The correlation between altcoins and Bitcoin (BTC) is very high, which explains why the drop in Bitcoin (BTC) also affects other altcoins. Therefore, the sudden crash in BTC prices led to Ethereum's price dropping by 8.76% over the past 13 hours. Similarly, Ripple (XRP) dropped by 5.31%, and Dogecoin (DOGE) dropped by 9.11%.
Although the forecasts for Bitcoin prices remain bullish, investors need to be cautious about the risks of a downturn as BTC's volatility has fallen to a 10-month low.
What will be the next movement for Bitcoin (BTC) prices?
Due to the recent drop, Bitcoin prices have formed a bearish engulfing candlestick, erasing Sunday’s gain of 3.23%. Continued selling pressure may lead BTC to fall to the critical support level of $101,000, coinciding with the previous range high. A drop below this level could cause BTC trading prices to decline, fluctuating between $100,300 and $99,800, a range formed by a single-point decline on the TPO chart.
Due to the overall bullish outlook for Bitcoin prices, investors should see a slowdown in BTC's upward momentum when entering this area. Such a trend may lay the groundwork for BTC's next historical high target — $118,000 and $135,000.
