Nearly two-year lows are tested by Bitcoin, and Ether extends Slide after merging.
Cryptocurrencies continued to trade near nearly two-year lows as investors in digital assets looked for a new stimulus as central bank rate increases lowered demand for risky assets.
For a third day, the price of bitcoin, the largest cryptocurrency by market value, wavered about $19,000. It previously declined by as much as 4%, returning to levels last seen in late 2020.
Ether, the second-largest cryptocurrency, lost 3% and continued to underperform, dropping roughly 20% overall since a much-heralded network upgrade last week.
The Federal Reserve’s intention to battle inflation by tightening financial conditions has the markets trembling.
Bond curve inversion, which is viewed as a harbinger of a coming recession, deepened when shorter maturity Treasury yields increased more than longer tenor rates. As investors looked for a safe haven, the dollar gauge reached a record high.
The Federal Reserve’s intention to battle inflation by tightening financial conditions has the markets trembling. Bond curve inversion, viewed as a harbinger of a coming recession, deepened when shorter maturity Treasury yields increased more than longer tenor rates. As investors looked for a safe haven, the dollar gauge reached a record high.
According to Brian Pellegrini, the founder of Intertemporal Economics, “the crypto system will witness a lot more failures if the Fed keeps tightening, unless it implements yield curve control to keep the curve positively sloped.”
There will be blood in the streets in the interim, but at the end a few extremely wealthy champions will emerge.
This week’s decline brings the MVIS CryptoCompare Digital Assets 100 Index’s losses for 2022 to approximately 60%, versus 23% for global stocks.
Equities and Bitcoin have a high and almost record-breaking connection, indicating that common macro causes are causing assets to fluctuate.
Ether continues to decline after a prior surge fueled by excitement over the Ethereum network upgrade fizzles out. Solana and Avalanche coins were available.
Some traders may look for confirmation that a bounce is probable from indicators like Bitcoin’s 14-day relative strength index. The momentum indicator, the RSI, is almost at oversold levels.
Nevertheless, after the Fed’s hawkish performance, contrarian bets on riskier assets seemed to be scarce.
