Cryptocurrency market faces huge increase in selling pressure after Bitcoin quickly reverses from $20,000
Luna Classic’s price performance was a pleasant surprise for its holders as the token was able to withstand the huge selling and shorting pressure that came from traders and break through all the upcoming resistance levels, but not for long.
According to the asset’s daily chart, LUNC reversed massively and lost around 10% of its value within 24 hours, as traders saw no fundamental support behind the rally. The main driver was Binance’s agreement to implement a 1.2% transaction fee. All funds from the transaction will be sent to the engraving address.
The initiative to burn LUNC was proposed with the aim of supporting the value of the asset in the market, as it was actively resisted by traders who saw no potential for the asset linked to any of the most questionable characters in the entire industry, Do Kwon.
However, industry experts did not expect anything exceptional even after the proposal was implemented, as the burning mechanism is not sufficient to prevent assets from falling permanently. Use cases and network revenue are two fundamental factors that investors typically consider when looking for assets to invest in, and LUNC, unfortunately, has none.
For now, the LUNC bulls are desperately trying to keep the asset from falling back to the values we saw a few days ago, but the trading volume and net flow around the asset shows that the bears are slowly recovering control of the token and most likely will. continue to put pressure on him to sell.
The market faces a new wave of selling pressure
Despite Bitcoin’s run above $20,000, the market faced a further surge in selling pressure, and mid to long-term investors were actively taking profits at the aforementioned price level. The first cryptocurrency has already returned to the price level we saw before the pump.
The lack of fundamental reasoning behind the Bitcoin rally could be the main reason why we are seeing such a rapid reversal from an important psychological level. Unfortunately, the reversal around the 50-day moving average was more than expected by the market, given the movements of funds on addresses held by whales and large retail investors.
With the plunge of the first cryptocurrency, altcoins are also facing increased selling activity from both small traders and large investors. Ethereum has already lost more than 7% of its value since yesterday’s spike.
Among the biggest market losers is XRP, which was once the market leader. However, the lack of positive news from the court and the reversal in the crypto market in general led to the reversal of the 200-day moving average.