Markets
Cryptocurrencies, Stocks Struggle to Overcome Macroeconomic Concerns, BTC Maintains Support at $63K
(Kitco News) – The cryptocurrency market was in consolidation mode on Tuesday as Bitcoin (Bitcoin) continued above $63,000 while most altcoins recorded small declines amid a slow day in the crypto news cycle.
“Shares rose more [in early trading] on Tuesday, driven by falling Treasury yields as traders looked for further indications of when the Federal Reserve might initiate rate cuts,” said analysts at Secure Digital Markets. “After a positive session on Wall Street, investors continue to build on the previous week’s momentum, bolstered by recent U.S. employment numbers and Fed Chairman Jerome Powell’s rejection of an imminent interest rate hike.”
But the initial rally stalled around midday after Disney’s earnings report disappointed and interest rate concerns returned to investors’ minds.
After a brief dip into the red, the main indices registered a slight recovery at the close of the market, with the S&P and Dow ending up 0.13% and 0.08%, respectively, while the Nasdaq lost 0.10% .
Data provided by TradingView shows that Bitcoin traded in a range between $62,815 and $64,445 on Tuesday, with bulls and bears evenly matched in terms of strength, giving neither side the advantage.
BTC/USD Chart by TradingView
At the time of writing, BTC is trading at $63,010, down 0.5% on the 24-hour chart.
Expected volatility
“Bitcoin has been hovering between $62,700 and $64,700 since Saturday,” noted analysts at Secure Digital Markets. “The continued decline in both the US dollar index and the 10-year Treasury yield has reinforced the valuation of risky assets. A rise beyond the $65,000 mark would undoubtedly signal a bullish purchase.”
Although BTC is currently in a holding pattern, analysts noted that the recent rally has “sparked excitement among crypto options traders: call volume significantly exceeds put volume, suggesting bullish sentiment in the market.” .
“Demand for out-of-the-money call options, with strike prices ranging from $70,000 to $100,000, has increased notably,” the analysts said. “According to data from Deribit, traders have secured more than $688 million in call options at the $100,000 strike across multiple expiries, marking the largest notional open interest on the platform.”
In the spot market, “buyers aggressively entered below $60,000, liquidating short positions at the end of the day.” he said market analyst Bloodgood. “The weekly $58K to $59K level holds for now, however, continuation is necessary or else sooner or later we will return to that level.”
“The daily level we are interested in now is slightly below $65,000, which will tell us if this bounce will take us higher or if we will fall below $60,000,” he added.
“On the daily chart, we can see that a clear downtrend continues, with a new low below $57K,” noted Bloodgood.
“The bulls will want to see a higher high form, which means we need to see Bitcoin above $67K, and the bears will want to see this daily resistance hold and take us back below $60K.” , he said. “It’s going to be a fun week.”
Addressing broader markets and the forces influencing asset prices, Bloogood said: “The macro pendulum continues to swing between hopes for a soft landing and dovish Fed policy on the one hand, and fears that inflation returns with force, on the other.”
“Lately, the movement has been largely in the direction of fear as hopes for substantial rate cuts this year began to evaporate, but then the boost the bulls needed was the Non-Farm Payrolls (NFP) report that came out on Friday,” he said. he said. “The NFP revealed that the US economy created 175,000 jobs in April 2024, a slowdown from the upwardly revised 315,000 jobs created in March and well below market expectations, which predicted an increase of 243,000.”
“Normally, a weaker job market is not what most people would consider good news, but in this context it is great for stocks and crypto as it pushes the Fed towards a more dovish approach,” concluded Bloodgood.
Mixed bag for altcoins
It was a mixed day for altcoins, with most tokens in the top 200 trending lower.
Daily cryptocurrency market performance. Source: Coin360
AIOZ Network (AIOZ) and Jito (JTO) managed to overcome the noise to post gains of 13.9% and 12.9%, respectively, while Ethena (ENA) rose 7.2%. Helium was the biggest loser, falling 5.6%, followed by a 5.6% drop for Book of Meme (BOME) and a 5.5% loss for Celestia (TIA).
The total cryptocurrency market value is now $2.33 trillion and Bitcoin’s dominance rate is 53.4%.
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