Second Quarter Dumps: Bitcoin and Ethereum Record Tremendous Losses

The crypto market is going through one of its toughest second quarter. Most cryptocurrencies have significantly lost a large chunk of their value over the last three months. This is attributed to the bearish dominance permeating the market.

The global cryptocurrency market is notably down. It was worth more than $2 trillion at the start of the current three-month period. Unfortunately, it is worth $955 billion at the time of writing.

This means it lost more than 50% in less than 120 days. It peaked at $2.6 trillion but retraced to a low of $824 billion which means the sector has slightly recovered from the downtrend.

The Fear and Greed Index has been one of the best indicators to turn to when trying to study traders’ mindset. The metric started a gradual downtrend until it hit a low of 6, which has not been seen in almost a year.

The effect of the bear market cannot be overemphasized as the image below sheds more light on it. Most of the depicted assets below have lost no less than 50% of their values since the start of the second quarter.

A closer look at the chart above reveals that one of the most affected coins over the last three months is Solana. It is down by almost 80% as it retraced from $122 and is currently exchanging at $42.

The market has seen its fair share of news stories but they have failed to have any positive effect on the industry under consideration. Some of the stories that have made rounds over the last three months were mostly bearish.

The Second Quarter Had Strong Bearish Fundamentals

One of the biggest news reports that disrupted the market is that the United States Fed plans to increase its reserve. It no doubt caused fear among traders as most cryptocurrencies dipped in the hours leading to the decrease.

The crypto industry lost almost $400 million to hackers over the last three months. One of the biggest hacks was on BeanStalk which resulted in a $182 million loss to the project.

Another hack happened yesterday that saw harmony lose $100 million. The cyber attackers exploited the protocols bridge and moved the funds, which they later exchanged for Ethereum on Uniswap.

Nonetheless, there were other bullish news stories. One such is the reopening of the Ronin bridge after it lost $625 million to threat actors. Additionally, the crypto market sees more institutional investments. Football star Cristiano Ronaldo recently signed a partnership with Binance to launch he’s own NFT collection.

The derivatives market also had its fair share of liquidation as bullish traders continued to lose funds due to the state of the market. During the second quarter, both the bulls and the bears lost almost $30 billion.

These were some of the few news stories that have made headlines over the last three months. How did most cryptocurrencies perform during the period under consideration? Let’s see

Bitcoin May Close the Quarter With its Biggest Loss

From the image above, it is not hard to understand that the bitcoin’s correction over the last three months is unprecedented. This is as far as the second quarter is concerned. A closer look at the below sheds more light on this.

Source: Skew

Since its introduction to the market, this is the first time BTC is down by 52% during the second quarter. Although, there are more improvements with regards to price, it will require a lot of effort to erase the 10% difference between last year and the current period.

The apex coin has seen its fair share of volatility. Since the start of the current three-month period, bitcoin has been on a consistent downtrend. It started with a drop below $45k and continued with losses of more than 9% the following week.

One of the highlights of the timeframe under consideration was during the first intraweek session of May when the asset lost 10% of its value and dipped as low as $33k for the first time in almost two months.

The most recent bearish milestone was a more than 22% drop that saw BTC dip as low $17k for the first time in more than 14 months. During the current quarter, the apex coin peaked at $48,234 and dipped to a low of $17,592.

In response to the consistent downtrend, almost all the indicators are bearish. The Moving Average Convergence Divergence is below 0 and is showing no signs of reversal.

Ethereum Suffered More

Ethereum suffered more severe conditions than the top coin. Before the market sank into complete bearish dominance, ether was exchanging above $3,000 which was one of the key levels at the time.

Following the start of April, the coin failed to continue its three-week  surge. As it gradually lost momentum, the downtrend intensified. It lost more than 9% during the first week.

During the next seven-day session, the asset lost the $3k support as it was sent hurdling down. One of the biggest dips happened in May has the coin lost more than 14%. The $2k level was also tested and flipped during this period.

The most recent downtrend took place during the second and third weeks of June as ETH lost more 20% on both occasions. The last one saw it retrace to a low of $879, a level not seen in more than one year.

At the end, the largest altcoin has lost almost 70% of its initial value, the highest in the second quarter history. As the last month of the 120-day period comes to an end, there are no positive fundamentals in sight.

Indicators are also very bearish at this time. For example, on the weekly chart, we observed that the asset’s Relative Strength Index is currently threading below 30. This means that ether is oversold.

It dropped below 30 during the second week of June and has since remained in the oversold region. MACD indicates that the asset had a bearish divergence during the second intraweek session in April.  There is no sign of trend reversal as both the 12-day EMA and 26-day EMA are below 0 and heading toward -500.