Bitcoin and most altcoins, led by Floki Inu, Hedera Hashgraph (HBAR), and Jasmy Coin (JASMY), are declining today as the recent rally takes a breather and traders start to book profits.
The price of Bitcoin retreated to $117,000, while Floki, HBAR, Jasmy, Pump, and Celestia were down by over 10%. The market capitalization of all cryptocurrencies dived by over 3% to $3.83 trillion, a week after it crossed the $4 trillion milestone. This article explains why crypto is going down today.
Crypto is Going Down Amid Profit-Taking
One possible reason why crypto prices are going down is that investors are taking profits after the recent surge. Indeed, some of the worst-performing coins are some of the top laggards today, July 24.
For example, the Floki price dropped to $0.0001270, an 18% decrease from its highest point this week. This decline happened after the token jumped by over 165% between its lowest point on June 23 to its highest point this month.
Similarly, HBAR price dropped to $0.245 from this month’s high of $0.2990 after surging by over 137%. The same is true for other top laggards, such as Jasmy Coin, Gala, Pump, and Celestia.
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Bitcoin Price Consolidation
Another reason why crypto prices are crashing is that Bitcoin is currently in a consolidation phase. After jumping to a record high of $123,200 earlier this month, Bitcoin has remained in a tight range around $118,000 this week.
It is common for altcoins to drop when Bitcoin is either consolidating or falling. On the positive side, as the chart below shows, this consolidation could be part of a bullish flag pattern formation, one of the most bullish signs in technical analysis.
A bullish flag is made up of a vertical line and a horizontal or slanted consolidation. It often results in a strong bullish breakout, which may push it to over $150,000 in the coming weeks. If this happens, these altcoins will rebound soon.
Crypto Crash Continues Amid Mean Reversion
Another technical reason for the crypto crash is known as mean reversion, which we discussed here. Mean reversion is a phenomenon where an asset returns to its historical average after a substantial deviation.
Most cryptocurrencies deviated from their moving averages during the recent rally, and this retreat is part of the reversion. For example, HBAR price jumped to a high of $0.2977 last week, much higher than its 50-day moving average of $0.1983. As such, it is normal for these tokens to retreat, aim for the average, and then rebound.
There are other reasons why crypto prices have retreated this week, including the ongoing Bitcoin ETF outflows and the upcoming deadline of Donald Trump’s tariffs.
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