The cryptocurrency market experienced a significant downturn yesterday, with Bitcoin dropping below the $115,000 threshold and Ethereum also sliding sharply. The combined market cap reached $3.91 trillion, reflecting losses exceeding $100 billion. This decline comes after weeks of steady gains for investors, as momentum appears to be waning. Analysts suggest several factors are contributing to this reversal, including the breakdown of the Bitcoin support level at $118K and increased volatility in the market. The price drop triggered significant liquidations, with long positions on both Ethereum and Bitcoin suffering substantial losses. The daily chart shows a bearish signal from a breaking wedge pattern, which often precedes deeper pullbacks. While crucial levels like $112K provide support for the market’s stability, further decline to $105K could occur if momentum doesn’t improve. Traders are cautiously optimistic as they await the next moves that may shape the remainder of August. The bearish trend is not solely influenced by technical factors; the US inflation report and a strengthening dollar index have also contributed to Bitcoin’s weakness, impacting other risk assets. Institutional investors have also pulled back from cryptocurrencies, with Bitcoin ETFs experiencing outflows following weeks of net inflows. Ethereum’s price mirrored Bitcoin’s movement, falling below $4,300 after earlier attempts to reach $4,800. If the $4,100 support level holds, Ethereum may attempt another surge towards $5,000. However, a break below this critical line could trigger a downward slide towards $3,600-$3,800. Altcoins also suffered losses as the market cap slipped below $4 trillion. If the $3.84 trillion support level holds, sideways consolidation might occur but a significant decline could trigger more losses for smaller-cap cryptocurrencies. The coming days will likely remain volatile, with Bitcoin and Ethereum facing challenges before the end of the month. Traders are watching closely as key levels like $115,000 and $112K become crucial to gauge market stability.