Written by:
Anshuman Roy
Published:
Updated:
Jan. 23, 2024 6:16 pm UTC
NEW DELHI (CoinChapter.com) — The run-up to the spot Bitcoin ETF launch had traders in an uproar, with everyone expecting Bitcoin (BTC) and other cryptos to launch a massive bull run. Instead, BTC price is down nearly 21% from Jan. 11’s high of $49,000, with other major tokens joining the list of crypto losers.
The downtrend in Bitcoin prices was likely a classic case of the ‘buy the rumor, sell the news’ trading mechanism.
Crypto trader MMCrypto shared a post highlighting the trend of traders selling the news after major crypto events, such as the launch of the spot BTC ETF or Bitcoin futures ETF.
However, traders remain convinced that the current bear run is just a minor correction before BTC and other crypto losers paint a series of green candles, hopefully to respective new ATHs.
Here are the top 5 crypto losers among the top 15 tokens (by market cap) since the launch of the spot Bitcoin ETF.
1. AVAX Price Continues Dismal Run To Enter Crypto Losers List
Avalanche’s native token AVAX price has been one of the top crypto losers in the new year. The crypto token rallied with the wider crypto market, riding the spot BTC ETF hype. However, AVAX prices corrected sharply on Jan.11, with the resulting downtrend paring its gains since Dec. 8, 2023.
AVAX bulls had hoped that the Bitcoin ETF hype might help the token launch a rally to break its downtrend. Instead, the token is down by nearly 35% since Jan. 11, forming a daily low near $27 on Jan. 23.
If the bears continue to sell, the AVAX price could drop to the support near $24. Breaching the support might force the token to test the support near $19.5 before recovering. Conversely, a rally would see AVAX price rise to the resistance near $33.
Breaking above the resistance might help the token rally to $38 before correcting.
The RSI remained neutral, scoring 31.75 on the daily charts. AVAX bulls remain optimistic about the token’s prospects, claiming that the drop in the token’s prices forms a good entry point for traders.
2. Polkadot (DOT) Price Holding Above EMA Support
DOT price action paints a trendline nearly identical to AVAX’s, with the Polkadot token’s downtrend beginning on Dec. 26 last year. Post the spot Bitcoin ETF launch, DOT price rallied to a high near $8.6 on Jan. 11 before plunging over 30% to a daily low near $6 on Jan. 23.
Bulls are trying to keep DOT price above the 200-day EMA (green wave). Manta Network, a project associated with the Polkadot platform, recently completed its token issuance event, but DOT price did not react to the news.
A rebound from the EMA support could see the DOT price rally to the 50-day EMA (purple wave) resistance near $7. On the other hand, if selling continues, the Polkadot token might drop to the support near $5.6 before recovering.
The RSI for DOT remained neutral, with a score of 34.67 on the daily charts.
3. Solana (SOL) Price Testing Bullish Pattern Support
Solana’s (SOL) price has been slightly more resilient than the other top crypto losers. After the spot Bitcoin ETF launch, SOL price dropped 26.3% to a daily low near $79. The token tests the bottom support line of a bullish technical pattern called the ‘bull flag.‘
Bull flags consist of a flag pole, resulting from a near-vertical rise in the crypto token’s prices. Assets in a strong uptrend often form the pattern. For the SOL price, the pattern is clearer in the weekly timeframe.
A period of consolidation succeeding the steep uptrend forms the flag of the pattern (dashed black lines). Despite the strong vertical rally, the asset price does not drop as bulls maintain the buying pressure. As a result, the breakout from the flag pattern often results in a powerful uptrend.
The pattern is completed when the price breaks out of the flag area, continuing the previous upward trend.
Traders calculate the price target of the breakout by adding the length of the flag pole to the breakout price level. Per the rules of technical analysis, the SOL price might rally over 569% to reach the theoretical price target near $551 if the Solana token confirms the pattern.
If the SOL price breaks the pattern’s support line, the token might drop to the support near $70. Conversely, if the pattern pans out, the resulting SOL price rally would face resistance near $108 before moving forward.
The RSI for SOL remained neutral, scoring 39.53 on the daily charts.
4. Cardano (ADA) Price Faces Death Cross Threat
Cardano price painted its third consecutive bearish candle on Jan. 23, testing descending trendline support (dashed black line), which bulls currently defend.
Unlike other crypto losers, ADA price has been in a downtrend since Dec. 14 last year, with a slight bounce in the run-up to the spot Bitcoin launch on Jan. 10.
The token dropped nearly 21% between Jan. 11 and Jan. 23 to reach a daily low near $0.49 on Tuesday.
If the ADA price slinks below the descending trendline support, the Cardano token’s price could drop to the support near $0.43. However, once Bitcoin price starts rallying after the spot BTC ETF launch, ADA price could exit the list of top crypto losers and rally to the resistance near $0.5.
The RSI for ADA remained neutral, with a reading of 36.78 on daily charts.
5. Surprise Entry To The List Of Crypto Losers, Ethereum (ETH)
Once spot Bitcoin ETFs gained approval from the SEC, crypto hopium addicts turned their attention to Ethereum’s Ether (ETH) ETF speculations.
However, the hype was shortlived, as the sell-the-news crowd did not spare the prime altcoin, leading to the token’s entry in the list of top crypto losers post ETF launch.
ETH price dropped 19.7% following the spot BTC ETF launch on Jan. 10, reaching a daily low near $2,166 on Jan. 23 before bulls recovered some ground.
$2,200 remains a critical support level for the token, with ETH price testing it multiple times since Dec. 3 last year. Failure of the key resistance level could force the Ethereum token to drop to the support near $2,020.
On the other hand, any positive update regarding an ETH ETF could attract buyers to the market, helping the Ether price reach the resistance near $2,400 before consolidating.
The RSI for ETH remained neutral, with a score of 38.6 on the daily timeframe.
