The highly volatile bitcoin market has once again entered a turbulent phase, causing anxiety among traders and investors as prices fluctuate unpredictably.
Benjamin Cowen, a prominent crypto strategist, believes that the market is now experiencing one of its most brutal stages within its cyclical nature.
According to Cowen, Bitcoin’s dominance, which represents its total share of the crypto market capitalization, is on the rise. This phenomenon occurs as the broader asset class’s risk appetite appears to be diminishing.
“We’ve been discussing this phase of the market cycle for a while,” Cowen wrote on Twitter. “Namely, where BTC drops, but BTC dominance (BTC.D) goes up because altcoins are dropping more. It is always the most brutal part of the market cycle.”
We’ve been discussing this phase of the market cycle for a while.
Namely, where #BTC drops, but BTC dominance goes up, because altcoins are dropping more.
It is always the most brutal part of the market cycle. pic.twitter.com/ueLIcwUkOw— Benjamin Cowen (@intocryptoverse) October 9, 2023
Bitcoin Dominance Increasing Amid Turbulent Market Conditions
Cowen used Fibonacci retracement levels to provide his perspective on Bitcoin’s dominance trajectory. He suggested that Bitcoin’s dominance is likely to peak at around 60%, similar to the previous cycle.
“I’m still a believer in the 60%. It could be slightly different. Like, it could be 59%,” he said. “It could be 63%. And some people say, Well, what about stablecoins? I think the stablecoin market is why it doesn’t go to 65% or 70%.”
As the crypto market grapples with this intense phase, traders faced substantial losses during a recent market rout. The sharp decline in digital asset prices was influenced by turmoil in the Middle East, escalating tensions, and uncertain global geopolitical events.
Market Turmoil and Losses: $100 Million Liquidated In a Day
According to data from CoinGlass, more than $100 million in losses resulted from liquidations on Monday alone, as digital asset prices experienced a sharp and sudden decline. This primarily involved long positions, indicating traders who had anticipated price increases and were later forced to exit their positions.
The market meltdown on Monday witnessed a staggering $105 million in long liquidations during the US afternoon trading session. This was the largest amount of long liquidations seen in a single day since the events of September 11.
Currently, Bitcoin (BTC) is trading at $27,590, experiencing a 24-hour decline of 1.3%. These price fluctuations serve as a reminder of the crypto market’s unpredictable nature, where fortunes can change within minutes.
In this environment of heightened volatility and uncertainty, crypto enthusiasts and traders must proceed with caution and closely monitor market developments. The crypto market’s ability to surprise, both positively and negatively, remains one of its defining characteristics, and participants must navigate these challenging waters with vigilance and adaptability.
Photo Credit: Shutterstock/K.unshu
