Cryptocurrency, Fear of $2.53 Trillion Defense Line Collapse...Crypto Market 'Stumbles' as Money Flows to US Stock Market

▲ Bitcoin (BTC) decline/ChatGPT generated image

The cryptocurrency market is losing $13.07 billion in market capitalization, pressured by the flow of risk assets towards the US stock market, and Bitcoin and major altcoin support levels are simultaneously under pressure.

According to BeInCrypto, a cryptocurrency-focused media outlet, on May 26 (local time), the total cryptocurrency market capitalization fell by 0.51% in the last 24 hours to $2.54 trillion. Approximately $13.07 billion flowed out of the market, and the movement of risk asset funds back into the US stock market was cited as the main reason for the pressure on the cryptocurrency market in May.

The total cryptocurrency market capitalization is currently at the Fibonacci 0.382 retracement level of $2.53 trillion. If this level holds, a scenario of recovery to the Fibonacci 0.236 retracement level of $2.6 trillion and the high of $2.72 trillion opens up. However, if $2.53 trillion breaks down, downward pressure could increase towards the Fibonacci 0.5 retracement level of $2.47 trillion and the Fibonacci 0.618 retracement level of $2.42 trillion. BeInCrypto reported that the S&P 500 showed stronger momentum than cryptocurrencies, rising 0.37% to 7,473.47 last Friday.

Bitcoin (BTC) fell by 0.60% in the last 24 hours, testing its lower support just above the Fibonacci 0.382 retracement level of $76,030. Bitcoin has been moving within an ascending parallel channel formed on March 30 for two months, and on May 23, the bottom of the channel was again pressured. Daily trading volume has continued to decrease since May 20, with yesterday's volume reaching the lowest level in the recent period.

BeInCrypto analyzed that Bitcoin's lack of buying interest is more akin to capital outflow than aggressive selling. The short-term resistance is the Fibonacci 0.236 retracement level of $78,654, and if this level is surpassed with accompanying volume, the possibility of recovering the channel top at $82,895 opens up. Conversely, if the daily candle closes below $76,030, the Fibonacci 0.5 retracement level of $73,910 and the Fibonacci 0.618 retracement level of $71,789 emerge as the next downward levels.

Zcash (ZEC) stood out among the top 100 cryptocurrencies with a significant drop of 4.25%, recording $624. Zcash has been compressing within an ascending parallel channel since April 29, with its lower boundary above $570, and decreasing selling volume is suggested as a sign that the recent correction may be closer to exhaustion than acceleration. If it recovers $657, a retest of the $688 high is possible, and if it surpasses the Fibonacci 0.618 retracement level of $799, $861 and $941 are mentioned as the next target levels. The defense of $570 is presented as a critical turning point that will determine between a 27% rebound towards the $800 vicinity and a channel breakdown.

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