In the past 24 hours, the crypto market has experienced a downturn following Bitcoin‘s halving event, causing it to relinquish its upward trend. Consequently, the total crypto market capitalization dropped by approximately 4%, from $2.47 trillion to $2.36 trillion – resulting in a loss of around $110 billion in value.
The price of Bitcoin has fallen below $64,000 recently, reaching a low of $63,589. This decline is likely due to decreased trading volumes and increasing uncertainty in the market. Despite the overall bullish sentiment among traders during this bull market cycle and expectations of a post-Bitcoin halving rally, some factors are making them hesitant in the short term.
The second largest cryptocurrency Ethereum experienced a decline of around 3%, causing its price to drop to approximately $3,100. Furthermore, several other altcoins such as Solana, XRP, Cardano, Dogecoin, Toncoin, and Shiba Inu underwent substantial drops, with Solana and XRP falling around 5%, while the rest experienced a decline of up to 10% within the past 24 hours.
$9.4 Billion In Crypto Market Expiry
The Fear & Greed Index shows a rise in investor sentiment, going from 57 to 72 during this past week. Market players are currently hesitant, looking for strong winds to subside before making new moves. The significant $9.4 billion monthly crypto options expiry serves as the major hindrance.
Approximately 96,000 Bitcoin options with a total value of around $6.3 billion will expire on Deribit this coming Friday. The put-call ratio is 0.68, suggesting an increase in demand for put options just before the monthly expiration. The price level that could cause the most significant market impact is currently set at $61,000, which is below the current Bitcoin price. There’s a high likelihood of substantial market volatility on the day of expiry, but traders dealing with derivatives are cautious and keeping their positions due to negative funding rates.
Additionally, approximately 977 thousand Ethereum options with a total value of around $3.1 billion are approaching their expiration dates. The put-call ratio stands at 0.49. The maximum potential loss for these options is $3,100, which is currently surpassed by the Ethereum price’s trading value of $3,252.
In the past 24 hours, the trading activity has shown a rise in the number of put options being opened, resulting in a put-to-call ratio of 0.94. This implies a higher demand for protective buying against potential price drops. The market price could reach its lowest point (max pain) before bouncing back after the expiration date.
US PCE Inflation Data
This week is considered packed with significant economic data, featuring events such as GDP and PCE inflation reports, as well as initial jobless claims and others. The Bureau of Economic Analysis anticipates strong U.S. economic growth based on their estimates, despite a decrease in growth rate for the second quarter in a row from 3.4% to 2.5%.
An important indicator for investors to watch on Friday is the U.S. Federal Reserve’s preferred measure of inflation, called Personal Consumption Expenditures (PCE). This data will be released, and it is hoped that it will indicate a decrease in inflation following the higher-than-expected readings from CPI and PPI. According to economists’ predictions, annual PCE inflation is projected to be 2.6%, an increase from the previous forecast of 2.5%. Meanwhile, the expectation for Core PCE inflation is 2.6%, down from the previous figure of 2.8%.
This year, reductions in the Federal Reserve’s interest rates have been crucial for signaling a market bottom for stocks and cryptocurrencies. It is anticipated that other central banks will probably adopt similar monetary policies.
Leveraged Crypto Liquidations
In simple terms, some high-risk cryptocurrency investments could lead to large losses due to market volatility, with possible further drops in value for Bitcoin approaching $60,000 if there are significant sell-offs.
According to Coingeasus data, over $220 million worth of cryptocurrency positions were forcedfully closed during the recent market downturn. Approximately $180 million belonged to long position holders, while around $40 million was from short position holders.
Approximately 92,000 traders had their positions closed, with the largest individual liquidation taking place on OKX cryptocurrency exchange when someone converted ETH into USD worth around $5.66 million.
On the #Bitcoin 12-hour chart, two signs hinted at potential sell opportunities. The first was a “death cross” formation between the 50 Simple Moving Average (SMA) and the 100 SMA. The second was a bearish pattern signaled by nine consecutive red candlesticks according to TD Sequential.
If $BTC falls below $63,300, brace for possible dives to $61,000 or even $59,000.
— Ali (@ali_charts) April 25, 2024
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2024-04-25 12:42