Altcoins record double-digit losses on the weekly time frame after the US Securities and Exchange Commission (SEC) brought lawsuits against the world’s two largest crypto exchanges Binance and Coinbase last week. The good news is that Bitcoin (BTC) has held its ground above a key support level, suggesting investors’ optimism in the big crypto.
In the two cases, the SEC listed several cryptocurrencies it considers securities, bringing to 67 the total number of digital assets the agency terms as securities.
As a result, prices of the top-cap non-stablecoin cryptos went on a downward spiral in the course of last week resulting in significant losses over the last seven days. Most of these are proof-of-stake (PoS) altcoins such as Solana (SOL) which records the weekly losses at 29.6%. This is followed by Polygon (MATIC) which is down 28.89% over the last week.
Cardano (ADA) and Binance Coin (BNB) come in third and fourth dropping 27.3% and 24.73% respectively over the same timeframe. Although not included on the SEC’s list, proof-of-work (PoW) coins Litecoin (LTC) and Dogecoin (DOGE) also experienced the brunt of last week’s sell-off dropping 17.89% and 15% respectively, according to data from CoinMarketCap.
Top Cryptos
Apart from other PoW cryptos, the SEC notably kept away from including Bitcoin and Ethereum (ETH) in its list of crypto securities. As a result, the two largest cryptocurrencies by market capitalization have held out relatively well amidst the turmoil.
The pioneer cryptocurrencies are only down 3.81% over the last seven days and Ether has lost less than 7% over the same period.
This is good news to the holders of these two assets as it is an indication that whales and institutional investors have not seen any reason to dump their positions. As a result, Bitcoin’s market dominance has increased to 47.77%, the highest level year-to-date.
Investors are likely to keep off in the short term due to the uncertain conditions. Bitcoin is likely to do well when the market conditions improve, as long as it holds out during this period.
Can Bulls Hold Bitcoin Price Above $25,000?
On June 10, Bitcoin dipped to the crucial support at $25,750, embraced by the middle boundary of the descending parallel channel. This implied that bulls are aggressively defending the 25,000 demand zone.
However, it should be remembered that repeated retests of a support level within short intervals tend to weaken it.
The downsloping moving averages and the downward trajectory taken by the relative strength index (RSI) indicate that bears are in control. The price strength at 40 suggests that there are more sellers than buyers in the market.
Therefore, if the support zone between $25,750 and $22,200 is breached, the price of the flagship cryptocurrency may draw lower to the vital psychologically level of $20,000. Market participants could expect BTC to take a breather here as buyers regroup to stage another recovery.
BTC/USD Daily Chart
If bulls want to prevent further losses, they will have to quickly push the price above the supply area between $27,300 and $27,500. This is a stubborn resistance zone because that is where the 100-day Simple Moving Average (SMA), the upper boundary of the channel and the 50-day SMA lie.
Breaching this level would suggest intense buying at lower levels. Bitcoin may first rise to $28,800 and thereafter, make the much-awaited return to $30.000. Buyers will have to push the price above this level to indicate the beginning of a bull run.