Bitcoin Drops 5.7% Amid Market Sell-Off, Altcoins At Risk
1min read Bitcoin's price experienced a significant decline, dropping towards the $82,000 mark on Sunday, March 30. This downward trend was part of a broader market sell-off that had been ongoing for three consecutive days. The sell-off was influenced by various factors, including the controversy surrounding the approval of the SEC chair nominee, Paul Atkins, and the potential impact of Trump’s tariffs on the market.
Concerns about a less crypto-friendly SEC chair replacing Atkins further exacerbated the sell-offs, leading to a 5.7% decline in Bitcoin's price since Friday. The price plummeted as low as $81,645 on Saturday before bulls managed to push it back up to the $82,500 level. However, the rising trading volume accompanying the downward price action suggested that bulls would need a strong catalyst to generate sufficient momentum for a major rebound.
According to on-chain data from IntoTheBlock, three cryptocurrencies—Dogecoin (DOGE), Chainlink (LINK), and Avalanche (AVAX)—exhibited a high correlation with Bitcoin's price action over the past 30 days. This correlation indicates that these assets have often moved in the same direction as Bitcoin. Specifically, LINK had a correlation of 0.93, DOGE had a correlation of 0.80, and AVAX had a correlation of 0.79 with Bitcoin, meaning their price movements largely mirrored Bitcoin’s trajectory.
If Bitcoin's price were to drop below the $80,000 mark, these altcoins could experience intensified sell-offs as traders attempt to hedge against further losses. Given their historically high correlation with Bitcoin, a sustained downtrend in Bitcoin's price could drag these cryptocurrencies significantly lower, triggering margin calls and forced liquidations in leveraged positions. Strategic traders may consider reducing their exposure to these assets or implementing stop-loss orders if Bitcoin continues to struggle for traction.
If Bitcoin fails to reclaim key resistance levels, a broader market downturn could push these correlated altcoins into deeper losses, reinforcing a bearish outlook. For traders looking to manage risk, these could be among the top cryptocurrencies to sell in a volatile market. The correlation matrix highlights a strong relationship between Bitcoin and these altcoins, making them vulnerable to further declines if Bitcoin's price continues to drop.
Ask Aime: What will happen to Bitcoin's price if it fails to recover from its current decline?
