With the crypto market under extreme stress, Decred saw a significant drop in its price charts. The altcoin crashed 27%, from a five-month high of $37 to a low of $27 – a sign of intense downward pressure.
At the time of writing, Decred (DCR) was trading at $28.5, down 19.5% on the daily charts. Its latest downtrend is a sharp reversal from the crypto market’s previous trend.
Before this period of depreciation, the altcoin was on an upward trajectory, increasing by 18% on the weekly charts. However, due to escalating tensions in the Middle East, the broader crypto market has collapsed. As expected, DCR also crashed heavily.
In fact, market activity suggests that some DCR holders may have capitulated and are now expecting further losses.
Dynamics are losing steam amid massive sales
After the announcement of a new war, the markets entered panic mode and participants turned to aggressive dumping.
When it comes to seller-buyer activity, seller strength jumped to 76 while buyer dominance fell to 23. This rise suggests that most active market participants have capitulated and started closing their positions, fearing further losses.
Source: Tradingview
Seller volume increased to 867,000 while buyer volume dropped to 943,000 – indicating an increase in sales activity. Unless market sentiment changes dramatically, sellers could be well positioned to dominate buyers.
It is worth emphasizing, however, that even though sellers have significantly increased their spending, exceeding demand, buyers remain confidently active in the market.
Is the bullish structure still intact?
Despite the decline in DCR’s value, Decred’s market structure has remained generally bullish. AMBCrypto previously reported that the altcoin was trading in an ascending channel. At press time, this remained the case.
Historically, an ascending channel has rotated an asset for a bullish continuation, with buyers buying on each dip. If this trend continues despite the current decline, it will end with a further rise once external conditions calm down.
Additionally, the DMI trend indicator showed that the altcoin still maintained in an uptrend. At the same time, the altcoin held above its MACD and SMA, with these indicators hovering between $20 and $26.
Source: Tradingview
While momentum still shows a bullish bias, a change in market sentiment could trigger an explosive surge. Therefore, given that the stock market crash was largely caused by external forces, a cooling period will allow DCR to erase recent losses and reach $35.
However, if the market shock and panic persists, Decred could fall to $24, with $20 serving as a key support level.
Final Summary
- Decred (DCR) crashed 27%, hitting a low of $27 amid heavy market selling.
- Decred’s bullish market structure remains intact, with buyers stepping in to accumulate during the pullback.
