The fall in the total market capitalization of cryptocurrencies on Thursday can be attributed to a number of potential factors.
Firstly, there is the bearish close of the S&P 500 (SPX), which decreased by 0.33%. This continued the drop that has been ongoing since Aug. 15, which has seen the index fall by 17.50%.
Due to the nearly perfect correlation (blue) between SPX and Bitcoin, a fall in the former usually causes a decrease in the latter.
A more important factor could be the Consumer Price Index (CPI) reading, which came at 8.20%, slightly higher than the expected rate of 8.10%.
It is possible that this will be the catalyst for a further rate hike, hence leading to investor panic. However, it is worth noting that the rate was lower than the previous CPI reading of 8.30%.
Bitcoin Price Performs Just as Badly as the Rest of the Market
At a drop of 3.8%, the cryptocurrency market cap has fallen at the same rate as the rest of the market. While the price initially reached a low of $18,190, it bounced shortly afterwards and is currently trading at $18,430. Measuring from the day’s opening, the price has decreased by 3.85%.
The daily RSI is bearish, since it has broken down from an ascending support line (green) and is below 50. This reading supports the continuation of the downward movement.
Since the price is in the process of breaking down from the $18,850 support area, the next support would be at the support line of the current wedge pattern at $17,000.
If BTC price reaches this area, it would reach a new yearly low, since the current low is at $17,622 (green icon).
Huobi Token Price Increases Despite Market Correction
HT price has increased by 76% over the past four days, posting an extremely negative correlation to the rest of the market. Price reached a high of $7.67 before being rejected (red icon).
The rejection occurred once Huobi Token price reached the $7.20 horizontal area, which is a crucial level that had previously acted as support for a year.
Since the price increase occurred shortly after the Huobi Global announced that a buyout vehicle of About Capital Management has purchased a majority stake in the company, it is possible that there is optimism around the deal and the future potential of the company and its new ownership.
For Be[In]Crypto’s latest Bitcoin (BTC) analysis, click here
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