After securing a record weekly close of over $100,000 on Sunday, bears took control and pushed Bitcoin price below the six-figure mark, leading to a volatile start of the week.
Most of the top altcoins lost the gains accrued over the past weeks, with SOS, PEPE and FLOKI leading the day’s gains.
The overall cryptocurrency market capitalisation slid below $3.8 trillion to hit a daily low of and was hovering over $3.7 trillion at publication time.
Effects of Bitcoin’s lacklustre performance were felt across the altcoin market, with the total altcoin market cap dropping approximately 2.76% in the past 24 hours as most of the top 99 cryptocurrencies struggled to stay profitable.
Interestingly, Bitcoin’s market dominance continued to recede towards the low 50s alongside the Altcoin Season Index, which had dropped to 77 from the 82 seen the previous day.
Market pundits pointed to profit-taking across both Bitcoin and altcoin markets as the most plausible reason for the post-election rally to cool off.
Will Bitcoin recover?
Experts and traders agree that Bitcoin’s long-term prospects look solid as the industry anticipates a pro-crypto government in the United States to take charge under the leadership of President-elect Donald Trump, and demand from institutional players and corporations continues to rise.
At the moment, significant profit-taking from long-term holders is outweighing the buying pressure generated by corporate Bitcoin purchases and spot Bitcoin exchange-traded funds inflows, according to CryptoQuant contributor Maartuun.
In a recent post, Maartuun pointed out that since Nov. 8, long-term BTC holders holding the flagship for at least 155 days have offloaded 827,783 BTC. On the other hand, Bitcoin buying from MicroStrategy and inflows into Bitcoin ETFs amounted to just 30% of what was sold.
Currently, heavy retail demand fueled by BTC’s recent rally past $100k is helping to counterbalance the strong sell pressure from long-term holders, with retail interest reaching “yearly highs,” according to CryptoQuant’s retail demand 30-day change chart.
Another potential factor behind the market slowdown could be traders awaiting the US Federal Reserve’s upcoming rate cut decision on Dec. 18, which historically tends to influence Bitcoin prices by increasing liquidity and reducing the opportunity cost of holding non-yielding assets like cryptocurrencies.
Previously, rate cuts have translated into substantial rallies for the flagship crypto, and another rate could be the catalyst Bitcoin needs for the next leg up.
As of December 9, the CME FedWatch tool puts the probability of a 0.25% December rate cut at 85.5%.
When writing, Bitcoin was down 1.7% in the past 24 hours, priced at $98,273. According to several analysts on X, the price needs to hold above the $98,000 support level for the momentum to sustain, or further corrections may follow.
Meanwhile, the leading altcoins for the day were:
Solana Swap
Solana Swap (SOS) soared 26.6% in the past 24 hours, exchanging hands at $4.02 at the time of writing.
The recent gains extended its weekly gains to 58.41% while bringing its market cap to over $2.4 billion.
Source: CoinMarketCap
SOS rallied amid hype surrounding the upcoming launch of the official version of Solana Swap.
The surge outpaced the broader crypto market, which has suffered a 4.6% drop as Bitcoin’s price continues to trade sideways over the past four days, failing to hold above the $100,000 level.
According to its white paper, Solana Swap is a decentralised intelligent routing exchange that leverages its integration with Google DeepMind’s open-source model and the high throughput of the Solana blockchain to offer users greater trading efficiency, enhanced security, and lower trading costs compared to traditional exchanges.
Pepe
Over the past day, Pepe (PEPE) was up 5.3%, trading at $0.000028 at the time of writing, extending its year-to-date gains to almost 2,000%.
The Ethereum-based meme coin hit a 3-year intra-day high of $0.0000271 on Dec. 9, along with its market cap surging past $11 billion for the first time.
Source: CoinMarketCap
PEPE’s recent rally followed its feature on the American news channel Fox News, which highlighted the meme coin as a profitable investment alongside the flagship cryptocurrency, Bitcoin.
Cryptocurrencies typically tend to rally following a major announcement or development.
Another potential catalyst for the PEPE rally is its listing on top-tier exchanges, Coinbase and Robinhood, which attracted significant interest from retail traders driven by FOMO and eager to capitalise on the meme coin following its impressive yearly gains.
Floki
Floki (FLOKI) rose 3.4% over the past day, reaching an intraday high of $0.00027 and bringing its market cap to over $2.5 billion at the time of publication.
The meme coin’s yearly gains stood at over 530%, which has drawn a lot of new investors to buy the second-largest meme coin in the market.
Source: CoinMarketCap
Additionally, the meme coin recently secured listings on two of Canada’s largest regulated crypto exchanges, Coinsquare and Bitbuy.
The announcement of these listings on such prominent platforms likely renewed interest among traders, driving a rise in the meme coin’s price.
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