Markets
Is the Crypto Rally starting to lose steam?
The broader crypto market has been buoyant recently, with Bitcoin (BTC-USD) and Ethereum (ETH-USD) rising 167% and 113%, respectively, last year. However, emerging telltale signs indicate that the cryptocurrency rally may be starting to lose steam.
Moderate Sentiment for Bitcoin
On Wednesday, Bitcoin jumped nearly 4.5% after a smooth inflation printing in the US However, the world’s largest cryptocurrency has fallen nearly 3% in the past five days, even after the US Fed signaled that a rate cut was on the cards this year.
Similarly, Ethereum is down around 4% in the last five days despite the Fed verdict and the SEC Indication of Approval for Spot ETH ETFs this summer. Even the former U.S. president Donald Trump’s position that all Bitcoin mining should be done in the US. largely failed to boost crypto prices this week.
Threatening data
Two data prints appear to confirm the potential crypto slowdown. Spot BTC ETFs recently experienced outflows for the first time in weeks. According to Farside Investors, outflows were almost US$200.4 million on Monday and US$226.2 million on Thursday.
Additionally, Robinhood Markets (NASDAQ:HOOD) reported a 30% sequential drop in its crypto trading volumes in May. This is an important indicator of waning interest in crypto, at least in the short term.
Is Bitcoin expected to rise or fall?
The current chart setup for BTC suggests any price gains may be short-lived as traders look for new catalysts for the recovery to continue.
Read full Disclosure