Bitcoin, Ethereum, Dogecoin Trade In The Red As Summer Doldrums Kick In: Analyst Says 'We Are Early In The Cycle'

Leading cryptocurrencies plunged lower Tuesday as traders remained cautious on fears about a shrinking market in the summer months.

What Happened: Bitcoin fell into the $64,000 zone for the first time in more than 30 days. The world's largest digital currency was down 2.5% over the month. Ethereum dipped below $3,500 during the trading hours.

In the past 24 hours, 125,148 traders were liquidated, with the the total liquidations coming in at $323.09 million. About $260 million in long bets was wiped out of the market.

That said, Open Interest in futures contracts showed a spike. Bitcoin's OI rose 0.31%, while Ethereum's OI increased 2.25%. An increase in OI, coming alongside a contraction in price, typically indicates the opening of new short positions, which is interpreted as a bearish market condition.

The Cryptocurrency Fear & Greed Index fell from 74 to 64 in the last 24 hours. Though technically still a "Greed" sentiment, the decline in magnitude suggested moderating buying pressure.

Top Gainer (24-Hours)

The global cryptocurrency market cap stands at $2.35 trillion, dropping 1.92% in the last 24 hours.

The stock market continued its upward climb Tuesday. The broader market index, S&P 500, gained 13.80 points, or 0.25%, to close again at a record high of 5,487.03. The tech-focused Nasdaq 100 gained 0.03% to finish at 17,857.02, its highest ever.The Dow Jones Industrial Average added 0.15% to end at 38,834.86. 

The rally was turbocharged by a 3.5% jump in the shares of AI giant NVIDIA Corp. NVDA which became the most valuable public company in the world.

May retail sales data was released earlier in the day, indicating weakness in consumer spending.

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Analyst Notes: Popular cryptocurrency analyst Rekt Capital painted a bearish outlook for Bitcoin

"When Bitcoin forms clusters of price action near the Range High resistance at ~$71600. Over time, price retraces to the downside to form new clusters of price action near the Range Low support area near $60600," the analyst remarked.

Another well-known analyst, Kevin Svenson, highlighted how it took between 30-40 weeks after halving in previous cycles for Bitcoin to soar above its all-time high. In contrast, ETF demand has pushed price upwards "faster than normal"  in the ongoing cycle.

"Believe it or not, we are early in the cycle," Svenson enthusiastically stated.

Photo by FellowNeko on Shutterstock

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