Battered Bitcoin still sore

Early Monday, Bitcoin’s perch, south of $49,000, looked snug yet precarious after the mayhem of the previous weekend, when the largest digital asset suffered its worst crash since May. As of Sunday night, BTC was about $49K, flat over a 24-hour period. With jittery U.S. markets set to open Monday, spot BTC, between 7 a.m. and 8 a.m. (EST), notched an hourly gain of 2.3%. Over the past 7 days, BTC has lost 15%. Since last year at this time, BTC has risen 155%.

Bells are ringing, but not of a festive variety. Data from CryptoQuant shows whales poised to dump, while sentiment has devolved into funeral-like somberness (Cointelegraph).

Most coins were oozing crimson as the U.S. markets were preparing to open. Bitcoin was trying to rouse out of its sickbed earlier this morning but, between 8 a.m. and 9 a.m. (EST), it laid back down, still licking its wounds.

Although not as bad as in May, when Bitcoin plunged 27% in 24 hours, from above $43K to below $32K, this past weekend's crash was no joke. Saturday's steep and sudden sell-off, amidst broader market fears, brought about a 20% decline in BTC's price, vaporizing more than $500 billion worth of market capitalization. More than $2.5 billion worth of leveraged positions were liquidated in one day. That was the biggest, fastest 24-hour flush in 15 months (CoinGape).

Meanwhile, traumatized Ethereum returned above $4,000 just now. Looking at ETH over 7 days' time, it has only lost 6%.

A slew of altcoins endured worse damage in that span. Looking at the weekly performance of the largest coins, there’s a definitive leader of the losers: Polkadot (-26%).

The only Big Ten coin in the green over seven days? That would be Terra's LUNA (+28%).

However, over the past 24 hours, LUNA has lost 12.5%.

What the heck just happened?

At the end of an exhausting week of worsening Omicron and inflation concerns, Bitcoin crashed late on Friday, plunging by $15K, to low-$40K levels not seen since September.

A strong dip-buying rebound then ensued. From a low near $41,900, BTC quickly shot back to $45,000. As the wild weekend drew to a conclusion, a psychologically important $50K mark came back into view.

"A perfect storm for a long liquidation cascade," on-chain analytics savant Will Clemente said of swollen open interest and dissipating weekend liquidity.

The removal of over-leveraged weaklings, flushed into oblivion, leaves a far less frothy market for BTC which nevertheless now faces "an uphill struggle and multiple potential resistance levels," Cointelegraph said.

"The majority of the markets are only expecting further downside to happen," said analyst Michaël van de Poppe.

One digital asset manager calmly conveyed a sober scenario ahead, one that's less of a thrill ride and perhaps instead becomes grueling slog: "Consolidation, a slow grind up," tweeted Lex Moskovski, CIO of Moskovski Capital.

In other words, prepare for more pain. Although Sunday’s snapback was a badly needed balm after the fire sale that lasted into early Saturday, including one nauseating hour in which the spot market price of BTC plummeted by $9K.