Augur Rises By 35%, Decreasing Bitcoin Volume May Trigger Short-Term Decline

In the past couple of days, the bitcoin volume has gone down from $5.5 billion to $3.5 billion, following an increase in the bitcoin price from $6,800 to $7,500.

Over the past week, the volume of bitcoin has declined by 36 percent, by over $2 billion. Similarly, the volume of other major currencies including ether, the native cryptocurrency of Ethereum and Tether (USDT), the most popular stablecoin in the international crypto market, also recorded drops.

A decline in the volume of bitcoin supported by an increase in the volume of Tether can be as a result of crypto investors hedging the value of their portfolio to the US dollar. Yet, on Sunday, the volume of Bitcoin and USDT decline at the same time, indicating that the demand for crypto as a whole has dropped in the past couple of days.

As a result, it is quite likely for a drop to the lower end of $7,300 in the short-term regardless of the strong 2 percent increase of Bitcoin on Sunday, due to its low trading volume and high Relative Strength Index (RSI).

Usually, a high RSI in the 60 to 80 level creates a short-term decline in the value of leading cryptocurrencies, except it is contradicted by a positive event such as a key regulatory change or development in the cryptocurrency industry.

High stability in the value and volume of leading cryptocurrencies has made it more possible for a $5,000 bitcoin drop, particularly it tokens and other minor cryptocurrencies go through significant declines.

Even though it remains unclear whether bitcoin will make a big sell-off to the lower end of $5,000, it is certain that, due to the instability of the market, the market is not ready to experience a large rally as it did in late April to reach $10,000 and target the $12,000 level.

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