bear market Ethereum predicted for major fall

Bear Market: Ethereum Predicted for Major Fall

Analysis

bear market Ethereum predicted for major fallIf you regularly pay attention to the markets, you probably have already seen the recent flash drop which has hit the industry. In the space of just 24 hours (from August 7 to August 8), the global market cap has fallen by 14%, leaving us at $221 Billion. This is the lowest that the global market cap has fallen to in the entirety of 2018. It is a stark reminder that we are still firmly within the grasp of a bear market.

Anybody who has invested in cryptocurrency within the last year should be familiar with drops of this nature, but that doesn’t take away from the fact that is still disheartening and sometimes humiliating. When events like this happen during a bear market, it often pushes people to their limits, leaving them searching for an exit from the industry.

Ethereum performs poorly in the bear market

The recent drop has led to veteran stock and crypto trader Peter Brandt to set a swing target of $127.74 for Ethereum. This means that Brandt is preparing for Ethereum to drop disturbingly low within the next 2-14 days. This is a bold prediction, but unfortunately, there is a chance that it could happen. Ethereum is known to perform more erratically than both Bitcoin and the global cap. In a general sense, Ethereum’s dips are harsher than Bitcoin’s and its rises are steeper. With that being said, Ethereum is actually performing slightly better than the global market cap right now. Ethereum has fallen by 11%, whereas the cap has fallen by 14%. This suggests that Ethereum might fair better than some other coins during the remainder of the bear market.

Is Ethereum an altcoin?

One of the main views held by crypto traders is that when Bitcoin falls, all altcoins fall too. For almost the entirety of the industry’s existence (including during this bear market), this has been true, but the statement begs the question of ‘what is an altcoin?’

Right now, most people are expecting Ethereum to drop so long as Bitcoin does, but that is because people consider it to be an altcoin. If it was considered in the same respect as Bitcoin, this might change people’s views. Generally speaking, people define an altcoin as any cryptocurrency which acts as an alternative to the market leader. In other words, altcoins are seen as cryptocurrencies which follow Bitcoin’s trends. Naturally, this encompasses all coins which are not Bitcoin, but is this accurate? Some would argue that Ethereum has partially stepped out of Bitcoin’s shadow in the past, therefore releasing it from the rigid definition of an altcoin.

While its market movements weren’t drastically different from that of Bitcoin, on June 14, 2017, Ethereum proved itself to be a major player in the industry by gaining a market dominance of 31%, leaving Bitcoin at a meager majority dominance of 38%. This event may be enough to argue that Ethereum should no longer be considered an altcoin. If this is the case, then we should be evaluating Ethereum as separate from the rest of the coins, in the same way we do with Bitcoin. If the market evaluates Ethereum individually during this bear market, it is possible that people will be able to make more accurate predictions in the immediate future.

It is not clear what will be happening within the coming weeks, but if the previous days are anything to go by, then we could be heading even deeper into a bear market. Traders should brace themselves for even harsher times and should make sure their finances are in check, ready for the worst to happen.

Kai is a cryptocurrency copywriter and professional trader. He can often be found investigating various cryptocurrencies, whitepapers, and blockchain technologies. Kai has been a professional writer for 5+ years, and has invested in 50+ different coins and tokens. He also currently studies Law and Philosophy at university.

Leave a Reply