crypto market The talk of the town. The crypto market has crashed more than 25% in 4 trading sessions.
In the past 6 weeks, the crypto market has crashed 40% and is one of the top money destroying asset classes. It has lost approximately US$830bn in total market cap.
This isn’t the first time something like this has happened.
Crypto is touted as the most volatile asset class of the decade and 25% is just a flip of the card.
During the early months of 2022, the crypto market fell over 40% and lost US$1 tn in market cap.
When I write about crypto, a quote from Satoshi Nakamoto comes to my mind:
Start the day with coffee. End the day with cryptocurrency.
Trade crypto with proper risk management. With such volatility, you might even need a coffee at night!
Technically, the total market cap of the crypto has dropped below the 100WEMA (Weekly Exponential Moving Average) for the first time since April 2020.
It is now trading at 40-week lows and has formed a lower high-lower structure which is a trend change according to Dow Theory.
If experts are to be believed, the crypto market has fallen due to widespread selling amid extreme fear. Institutional investors seem to have been selling their crypto holdings in bulk, causing a massive price crash.
recent fall bitcoin, the biggest cryptocurrency, less than US$30,000. Bitcoin hasn’t traded at this low since July 2021.
In the midst of all this bloodshed, El Salvador has bought the dip that it seems. The President of Salvador announced that his country had bought 500 more bitcoins.
Reportedly, since El Salvador adopted cryptocurrency as legal tender, the Salvadoran government has purchased 2,301 bitcoins.
Currently, Bitcoin is trading at US$31,540 while Ether is down 3% at US$2,379.
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Equitymaster’s Take on Cryptos
We don’t get crypto. Honest.
It’s something that has captured our imagination, but we can’t seem to figure out a way to value it natively.
Chartists like our own Brijesh, study the prices and suggest different levels. We understand this.
Having said that, our ‘fundamental’ take on crypto is simple. This is in line with the approach one should have when dubbing in a place they don’t understand.
Invest only what you can afford to lose. nothing more.
Happy investment!
Disclaimer: This article is for informational purposes only. This is not a stock recommendation and should not be treated as such.
This article is syndicated from Equitymaster.com