The cryptocurrency market has entered a downturn

The cryptocurrency market has seen a downturn in the past few days, experiencing its largest losses within the last 24 hours. This retreat occurred amid concerns among some investors about signs indicating that the crypto market may have reached a temporary peak.

In particular, over $230 billion disappeared from the total market capitalization of cryptocurrencies, accompanied by over $650 million in liquidations. According to TradingView’s Cryptocap 4-hour chart index, the market witnessed a loss of $233.33 billion in capitalization within a day, dropping from $2.508 trillion to as low as $2.275 trillion at the time of writing.

Bitcoin (BTC) played a significant role in this downturn, given its status as the market leader and its dominance in market capitalization exceeding 53%. Specifically, BTC’s value decreased by $100 billion within 24 hours, dropping from $1.342 trillion to $1.242 trillion in market capitalization.

During the same period, the crash led to the liquidation of over 244,000 cryptocurrency traders, resulting in liquidations worth over $655.31 million, as reported by CoinGlass data. Notably, over $538 million were in long positions, causing a long squeeze that had been forewarned by Finbold since early March.

Furthermore, nearly $500 million of the $655 million liquidated occurred within the last 12 hours, with $419 million originating from long positions.

In light of these developments, investors are speculating whether cryptocurrencies have indeed reached a temporary peak after months of a bullish rally. The recent surge in meme coins could be interpreted as one of these “top signals,” as highlighted by Finbold over the weekend. Additionally, prominent investors and financial experts have expressed similar concerns amidst the market downturn.

For instance, Scott Melker has identified relevant “top signals,” which he typically looks for when not influenced by emotions like the Fear of Missing Out (FOMO). Melker cites the meme coin boom, overbought altcoins, and bearish divergences in multiple technical indicators as indicators of a potential market peak.

In conclusion, despite the increasing popularity of Bitcoin ETFs, the market may have reached a temporary peak. However, Scott Melker and other investors believe that retail investors are not yet paying adequate attention to the warning signals indicating a possible downturn in the market.