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The bullish momentum seen in the crypto market throughout July appears to be waning as a new month begins.
Crypto markets have declined by 3.7% over the past 24 hours, dropping total market capitalization back below $1.1 trillion once again.
Since their weekend and seven-week high, more than $50 billion has exited the space in what appears to be a cooling of the bear market relief rally.
Markets were unaffected by the double-whammy of macroeconomic news last week as the U.S. Federal Reserve raised rates and the country fell into a technical recession.
However, the bears appear to be back in control of things today as cryptocurrencies are a sea of red.
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Bear market relief rally
On-chain analytics provider Glassnode took a look at technical indicators in its “Week On-chain” report to ascertain whether “it is a bear market relief rally or the start of a sustained bullish impulse.”
Despite the recent rally, Bitcoin price action has remained range-bound since its epic crash in mid-June. It has failed to break above key resistance at just over $24,000 and has fallen back below $23,000 today.
Glassnode confirmed this, stating “current network activity suggests that there remains little influx of new demand as yet.” It added that transactions have been sideways to slightly lower which is indicative that only the “stable base of higher conviction traders and investors remain.”
Lackluster transaction demand, address activity, and low fees are all indicative that things are “firmly within bear market territory.”
Bitcoin is currently trading right on its 200-week moving average at $22,872, and just above its Realized Price which is $21,816 according to Woo Charts.
The Glassnode data analyzes last week’s crypto market action and has not taken into account the past two days of declines, however, which are likely to be even more bearish.
Altcoins in the red
Bitcoin’s 2.3% daily decline is not as bad as its brethren are suffering. Ethereum, which has been driving market momentum recently, has lost 7% on the day in a fall to $1,576 at the time of press according to CoinGecko.
Binance Coin (BNB), Cardano, and Solana are all down 4%-6% while Polkadot (DOT) has dumped 12.7% on the day.
All on-chain indications suggest that the recent rally has only been a bit of bear market relief and further declines are likely as the crypto winter drags on.
