A very important question, indicating a recurring phenomenon in the cryptocurrency market, especially during downturns or significant volatility.
🔍 The main reason: Weak buying momentum and increased selling pressure
When most cryptocurrencies are below their average cost (like the 50 or 200-day moving average), this reflects several combined factors:
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🧠 Detailed reasons:
1. Weak demand against supply in bear markets, traders and investors reduce buying while the number of sellers increases.
This drives prices down and keeps them below the moving averages.
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2. Whale control over the market
When prices are below the averages, it may be intentional by the 'whales' to gather liquidity from small investors.
This strategy is known as 'shakeout' (forcing the weak out of the market before the rise).
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3. The absence of stimulating events (Catalysts)
The market needs positive news, such as: launching major projects, government adoption, or institutional support.
In the absence of these catalysts, prices remain weak for a period.
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4. The state of fear and uncertainty (FUD)
Negative news, or regulatory issues (like the crackdown on Binance or Coinbase), lead to liquidity flight.
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5. The market is still in a correction phase after an upward cycle
If the market has seen a strong rise in a previous period (like what happened at the end of 2023 or the beginning of 2024), prices need time to correct themselves.
Therefore, it remains below the averages until confidence gradually returns.
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🧭 What does this mean for the smart investor?
These periods can be smart accumulation opportunities for strong projects at low prices.
But with a condition:
To have a long-term investment perspective.
And for the currencies to be supported by strong fundamentals (team, use cases, actual adoption).