Markets

Midday sell-off leaves cryptocurrencies in the red to end the week, consolidation expected through Q3

Published

9 months ago

10 May, 2024

Midday sell-off leaves cryptocurrencies in the red to end the week, consolidation expected through Q3

(Kitco News) – The crypto market ended the week with more unstable prices, as Bitcoin (Bitcoin) continued to consolidate between $60,000 and $65,000, with flash crashes and unexpected rises keeping derivatives traders guessing about what comes next.

Stocks posted mixed but mostly positive results, with the Dow managing to close its eighth consecutive session with gains, finishing up 0.32%, while the S&P rose 0.16% and the Nasdaq was flat.

“The S&P 500 surpassed the 5,200 mark for the first time since early April, fueled by growing optimism after the Federal Reserve suggested a rate hike might not occur,” said analysts at Secure Digital Markets. “This, coupled with a strong earnings season and weaker labor data, has bolstered investor confidence in equity markets.”

A pullback in the Dollar Index (DXY) also boosted markets, according to analysts at Bitfinex.

“The DXY reached a 6-month peak around 106.48 on May 1, before falling 1.85% from the high following last week’s FOMC meeting, when the US Federal Reserve took a decidedly dovish stance and announced an upcoming reduction in quantitative tightening (QT), the analysts said.

“Non-farm payrolls data in the same week signaled a weaker labor market, further accelerating the dollar’s decline while at the same time driving a move higher across all risk assets, including Bitcoin and the market. of US stocks,” they added. “The reason behind this is that weaker than expected employment data could lead to concerns about the economic slowdown, which could increase the likelihood of interest rate cuts by the Federal Reserve.”

“Lower interest rates or the expectation of rate cuts could lower the yield on U.S. dollar investments, making the dollar less attractive and potentially weakening the DXY,” the analysts noted. “The rise of the dollar has strongly impacted the rise of risk assets and may be correlated with Bitcoin weakness (not the cause behind this, but the correlation is evident), but we believe that sustained strength and a recovery from the lows of the BTC post-FOMC and labor market data and simultaneous dollar weakness are a sign of a new regime that would set us up for a very bullish third and fourth quarter for Bitcoin.”

That said, they warned that they “expect the market to remain uncertain in the short term in a low volatility environment until the actual QT reduction occurs in June.”

Data provided by TradingView shows that Bitcoin suffered a sharp sell-off around midday on Friday, which dropped the top crypto from $63,000 to a low of $60,155, and has been consolidating below $61,000 since then. .

BTC/USD Chart by TradingView

At the time of writing, BTC is trading at $504, down 3.55% on the 24-hour chart.

Expected Short-Term Weakness

“We have been ranging between ~60K and ~64K over the last few weeks and the general trend appears to be consolidation with a downward bias,” said Chris Yin, CEO and co-founder of Plume Network. “So in the short term we will see, but Bitcoin could very well continue to fall for a while, which is natural. Following the BTC halving and after several months of upward-only price action, it is natural to see some cooling, especially with the Fed still not reducing interest rates.”

Yin said exaggerated expectations of rate cuts mean “the market is a little ahead of reality, so naturally there will be some pullback. Furthermore, global macroeconomic instability is also an issue” amid a growing number of global conflicts, “which leads to apprehension and a more expectant approach. Not to mention all the well warnings Gary [Gensler] continues to spread randomly across the crypto landscape.”

“Another thing that’s different this time is that we have the BTC ETF,” he added. ETF flow data shows “that things have cooled in recent weeks and even some net outflows in some weeks, which signals weakness in demand,” which Yin said “could very well [lead to] more disadvantages for a while.”

“But if you zoom out a little bit, you can see historically, after halvings, we cut in the same range for up to 3 months, and after that, we start to see stronger price action upwards,” he noted.

Yin added that “open interest has also been decreasing in recent weeks, which signals the same thing – traders are less optimistic than before, although still in the positive. This just means that there are fewer open long positions than before, signaling that there is some apprehension in the market, although sentiment is still broadly positive.”

He said what people really need to look at is the macro environment.

“First, we are waiting for economic data to improve and signal rate cuts,” he said. “Inflation has been stubbornly high, so when it cools, Jerome Powell may finally cut rates. The minute this happens, we will see a reversal in all of these indicators – BTC ETF flows will return, traders will feel comfortable taking risks again, and prices will rise.”

“In parallel, the US elections in November will be a big indicator as Trump has been signaling that he is positive on crypto versus the Biden administration, which is clearly very negative” on the asset class. “So if Trump wins, we go up and if Biden looks like he’s winning, things get a little more reserved.”

Altcoins slide into the red

Most altcoins in the top 200 followed Bitcoin’s downward lead, although about two dozen managed to avoid the sell-off and post gains on Friday.

Daily cryptocurrency market performance. Source: Coin360

Akash Network (AKT) was the best performer, gaining 14.6% to trade at $5.93, followed by a 6.4% rise for Jito (JTO) and a 5.3% gain for ZetaChain (ZETA ). ssv.network (SSV) was the biggest loser, falling 17.5%, while cat in a dogs world (MEW) lost 11.6% and AIOZ Network (AIOZ) fell 8.2%.

The total cryptocurrency market value is now $2.25 trillion and Bitcoin’s dominance rate is 53.2%.

Disclaimer: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes. This is not a request to carry out any exchange of goods, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no liability for loss and/or damage arising from the use of this publication.

Source

Up Next

CoinDesk Video | Latest Crypto Video News

Don't Miss

Banking giant Wells Fargo reveals investments in Bitcoin ETFs

FinCrypt Staff

We are the editorial team of FinCrypt, where seriousness meets clarity in cryptocurrency analysis. With a robust team of finance and blockchain technology experts, we are dedicated to meticulously exploring complex crypto markets with detailed assessments and an unbiased approach. Our mission is to democratize access to knowledge of emerging financial technologies, ensuring they are understandable and accessible to all. In every article on FinCrypt, we strive to provide content that not only educates, but also empowers our readers, facilitating their integration into the financial digital age.

Click to comment

Markets

Crypto Markets Rebound as Spot Bitcoin ETFs Attract Massive Inflows

Published

6 months ago

17 July, 2024

FinCrypt Staff

Crypto Markets Rebound Ahead of Early Ethereum ETF Approval

This week saw $722 million worth of Bitcoin spot ETF inflows, including the largest daily inflow in a month.

Cryptocurrency markets rallied on Wednesday, driven by inflows into spot Bitcoin exchange-traded funds (ETFs).

The price of Bitcoin (BTC) is up 3% over the past 24 hours to last change hands at $65,200, according to CoinGecko. Ethereum (ETH) is up 2% and is trading at $3,471. Solana (SUN) and Polkadot (POINT) increased by 4%.

Bitcoin spot ETFs saw $422 million in daily inflows on Tuesday, the highest in the past 30 days, according to Far side data, . The all-time record for a single day was $1.05 billion on March 12.

Among Tuesday’s top contributors, BlackRock’s IBIT led with $260 million in inflows, followed by Fidelity’s FBTC with $61 million. This week has already seen more than $722 million in inflows.

Among the top 100 cryptocurrencies by market cap, Worldcoin (WLD) led with a 28% increase, followed by Helium (HNT) with 20% and Lido DAO (LDO) with 15%.

Worldcoin, a decentralized identity project led by OpenAI CEO Sam Altman, announced is extending the lockups for early investors and team members. This means that tokens will be gradually released through 2029, instead of the original 2027 plan. Token unlocks are generally seen as a negative because they increase supply and early investors can sell their tokens for profit.

Meanwhile, XRP, the token of the XRP Ledger network, jumped 8% after the CME and CF benchmarks introduced new indices and reference rates for XRP.

U.S. stocks faced a downturn on Wednesday. The S&P 500 fell 1%, while the Nasdaq Composite and Dow Jones Industrial Average both fell 2%.

Source

Markets

Altcoins on the cusp of a major breakout – WLD, AR, and INJ prices could surge by 20% in the coming days

Published

6 months ago

17 July, 2024

FinCrypt Staff

Altcoins on the cusp of a major breakout – WLD, AR, and INJ prices could surge by 20% in the coming days

Crypto markets appear to have been taken over by the bulls as major tokens have surged above their crucial resistance zone. Bitcoin surged above $65,000 while Ethereum was above $3,500, and XRP, which had remained passive for quite some time, surged over 40% in the past few days to hit $0.6. The uptrend has been captured in most altcoins, with Worldcoin (WLD), Arweave (AR), and Injective (INJ) leading the rally. Here’s what to expect for these tokens in the coming days.

Worldcoin (WLD) Price Analysis

O Worldcoin Price has been trading inside a descending wedge since it marked a new ATH near $12 in the final days of Q1 2024. The recent price action helped the price break out of the upper resistance of the wedge, breaking above the crucial resistance zone between $2.21 and $2.39. Market sentiments have changed, but technicals suggest that the bulls may remain passive for a while, which could offer some room for a bearish pullback.

The price broke out of the wedge with a significant increase in volume, but the current volume suggests that the bulls have taken a step back. Meanwhile, the RSI is about to reach the upper boundary, which could attract bearish forces. Additionally, the DMI has undergone a bullish crossover, but the decline in the ADX suggests that the rally may remain consolidated above the gains. Therefore, the WLD price is expected to maintain a horizontal consolidation between $3 and $3.3 and trigger a fresh rally to $4.4 during the next bullish rally.

Arweave (AR) Price Analysis

Arweave formed a strong base around $25, which helped the rally trigger a recovery during the bearish attack. Mt. Gox and German terror forced the price to fall below $20. However, the recent price action has brought the altcoin within the bullish range and raised expectations of maintaining a decent uptrend for a few more days.

AR price has hit one of the major resistances around $30 to $31.5, which could act as a strong base once overcome. The buying volume is slowly increasing, which could keep the bullish hopes for the rally high. Moreover, the supertrend has just flashed a buy signal, indicating a clean reversal of the trend. Therefore, AR price seems primed to maintain a healthy uptrend and rally above $40. However, if the bulls maintain a similar trend, making new highs above $50 may not be a tedious task for the bulls.

Price Analysis of Injective (INJ)

Injective price has been showing sharp strength since the beginning of the year and hence, the recent turnaround is expected to revive a good uptrend going forward. The bears engulfed the rally to a large extent, but the recent price action suggests that the bulls have regained their dominance. Therefore, INJ price is expected to maintain a strong uptrend with a bearish interference on the way down.

INJ price has surged above the lower support zone and has registered consecutive bullish candles. Although the volume is below the required levels, the OBV is maintaining a sharp uptrend. Furthermore, the Ichimoku cloud lead span B is heading towards the lead span A and a healthy crossover indicates the start of a new uptrend. However, INJ price may be out of the bears’ reach once it secures the resistance zone between $30.77 and $32.12, which seems to be on the horizon.

Source

Markets

Ethereum at $3.5K, Exchange Supply Hits 34-Month High

Published

6 months ago

17 July, 2024

FinCrypt Staff

Ethereum at $3.5K, Exchange Supply Hits 34-Month High

Ethereum (ETH) supply on exchanges has hit a 34-month high as the asset’s price surpassed the $3,500 mark.

ETH has risen 2.3% over the past 24 hours and is trading at $3,490 at the time of writing. The second-largest cryptocurrency — with a market cap of $419 billion — briefly touched an intraday high of $3,517 earlier today.

ETH Price, Whale Activity, RSI, and Exchange Supply – July 17 | Source: Santiment

Ethereum’s daily trading volume also increased by 7.6% to reach $19.8 billion.

According to data provided by Santiment, the supply of Ethereum on exchanges has reached $19.52 million ETH. This level was last seen in September 2021, when the asset was trading around the same price.

On the other hand, data from the market intelligence platform shows that the number of whale transactions has fallen by 12% in the last day — falling from 8,730 to 7,629 unique transactions per day.

The move shows that the supply of Ethereum on exchanges has been increasing with small deposits rather than large transactions from whales.

Additionally, the ETH Relative Strength Index (RSI) is currently hovering at the 60-mark, per Santiment. The indicator shows that Ethereum is slightly overbought at this price point, but it may not be in a critical position due to its large market cap.

One of the main drivers of Ethereum price increase is ETH spot expectations ETFs in the US Investment products are scheduled to start trading on July 23rd.

Source

Markets

Bits + Beeps: How to Play the ‘Trump Trade’ in Cryptocurrencies After the Assassination Attempt

Published

6 months ago

17 July, 2024

FinCrypt Staff

Bits + Bips: How to Play the ‘Trump Trade’ in Crypto After the Assassination Attempt

Also, how much will the Fed cut rates (and when)? What will be the inflows into ETH ETFs? And what is the near future for Bitcoin?

Posted on July 17, 2024 at 12:00 PM EST.

Listen to the episode at Apple Podcasts, Spotify, Capsules, Source, Podcast Addict, Pocket molds, Amazon Musicor on your favorite podcast platform.

In this episode of Bits + Bips, hosts James Seyffart, Alex Kruger and Joe McCann, joined by guest Jack Platts, dive into the market reaction to the recent assassination attempt on former President Donald Trump, analyzing how this event will influence the 2024 US presidential election and the cryptocurrency markets.

They also cover potential rate cuts: Could there be a cut in July? How big could the September rate cut be? Could the decision be influenced by the upcoming election?

They also give their predictions on what percentage of BTC ETF inflows the ETH ETFs will reach, and James talks about what he expects for Grayscale’s ETHE (hint: his outlook would be positive for ETH).

Finally, they delve into what’s next for Bitcoin as the German government runs out of BTC and Mt. Gox distributions begin. Just now?

Program Highlights:

Whether Trump’s shooting decided the election and whether the event caused a “flight to safety”
How election markets are becoming a place to watch election probabilities and whether cryptocurrencies “lean right”
Whether rate cuts will occur in July or September and by how much they will cut: 25 bps or 50 bps
How Joe sees the relationship between global liquidity cycles, rate cuts, and the potential rise of Bitcoin
What are the new updates about Ethereum ETFs and their expected launch?
Why Solana Hasn’t Performed Significantly Better Since Trump News
What Market Breadth Indicates About the Current Market Rally and the Impact of Rates on Small Caps
Everyone’s predictions on ETH ETF inflows and how much outflow we’ll see on Grayscale’s ETHE
What’s Next for BTC After German Government Exits Bitcoin and Mt. Gox Giveaways Starting This Week