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Bearish signal: Bitcoin and Ethereum reach 2021 levels | bitcoinist.com

Bitcoin (BTC) and Ethereum (ETH) are still on the rise since digital asset prices hit pre-FTX crash levels. They continue to see green moves in the market, posting gains right now, but that might not last long.

Bitcoin and Ethereum are undervalued

In a message shared by Santiment on Twitter, the on-chain data aggregator revealed that there was massive profit taking on the two biggest cryptocurrencies in the market. Given that both assets have seen massive gains since early January, this is understandable as investors would want to take profits from their investments, but it could also give them some bearish sentiment.

According to the chart shared by Santiment, the level of profit taking recorded on Bitcoin and Ethereum reached 2021 levels. 2021 was the year when the bull run peaked, triggering massive profit taking.

BTC and ETH profit-taking reach 2021 levels | Source: Santiment

As seen in the chart above, Bitcoin’s profit taking hit February 2021 levels, while Ethereum surged to October 2021 levels, just before the digital asset hit its price. record $4,800. This could have serious implications for the current bullish mini-run.

How could this affect the crypto market?

As Santiment points out, the scale of profit taking could lead investors to believe that the recovery will not last. If holders choose to sell, they likely want to take profits ahead of what they believe is an inevitable downturn.

If they are correct and the top of the current rally has been marked, it could mean that the downside correction is weaker than expected. Bitcoin will likely fall below $20,000 in this scenario and Ethereum will again lose its footing above $1,500.

In February 2021, when bitcoin experienced such highs, its price lost more than $10,000 of its value. As for Ethereum, it had fallen by more than $1,000 in the following months.

Similar to previous times when profit taking was this high, Bitcoin and Ethereum prices are expected to fall in tandem. And if history is any indication, such a drastic drop in current prices could put both digital assets at prices well below their cycle lows. Moreover, it would mean that the bottom has not been reached, contrary to what many believe in space.

The price of BTC is currently trading at $21,267 and Ethereum is seeing prices of $1,570. The price of BTC has increased by 2.13% in the last 24 hours and the price of ETH has increased by 1.82% in the same period.

TradingView.com Bitcoin Price Chart

BTC recovers above $21,000 | Source: BTCUSD on TradingView.com
Follow Best Owie on Twitter for market news, updates and the occasional funny tweet… Featured image from The Street, chart from TradingView.com



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