As an experienced analyst, I believe that today’s crypto market selloff is primarily driven by a combination of external factors such as the UK inflation data and the FOMC Minutes release. The unexpected increase in the US 10-Yr Treasury yield and the cautious approach taken by traders due to the Fed’s potential delay or reduction in rate cuts have added to the market’s uncertainty.
As a crypto investor, I observed a significant sell-off in the cryptocurrency market during US hours on Wednesday. With apprehension looming after the recent market recovery, the total value of the crypto market took a hit, plummeting roughly 2.50% to an staggering $2.57 trillion.
In the past hour, Bitcoin‘s price dropped by 1%, causing it to dip to $69,500. Over the last 24 hours, this decrease translates to a loss of over 2%. Furthermore, the trading volume has seen a significant drop of more than 35% since the recent surge in activity.
As a market analyst, I’ve noticed that Ethereum‘s price has taken a 3% hit in the past 24 hours, despite promising developments regarding a spot Ether ETF. Similarly, other leading altcoins such as Solana, XRP, Dogecoin, Cardano, and Shiba Inu have seen drops of 2-3% within an hour. Additionally, lesser-known tokens like PEPE, BOOK OF MEME, GALA, and WIF have experienced declines of 3-6%. Let’s delve into the potential reasons behind this market downturn.
Bitcoin, Ethereum and Meme Coin Prices Fell
The crypto market experienced a wider sell-off following the unveiling of the UK inflation figures. The yearly inflation rate in the United Kingdom decreased to 2.3% compared to the previous month’s 3.2%. However, this reading was above the anticipated 2.1% level. Surprisingly, the Pound Sterling gained strength notwithstanding the inflation figure surpassing forecasts, since it is close to the Bank of England’s 2% target.
I experienced some volatility in the US dollar index (DXY) today, with it ultimately decreasing following the release of the UK inflation data. However, an unexpected surge of 0.027% brought the US 10-Year Treasury yield (US10Y) to 4.457%. Consequently, Bitcoin continued to exhibit volatility amidst relatively low trading volumes.
As a crypto investor, I’ve noticed that today’s FOMC Minutes release has left me and many traders adopting a more cautious stance. Previously, there were expectations that inflationary pressures could lead to multiple Fed rate cuts this year. However, recent comments from several Federal Reserve officials suggest that these cuts may be delayed or even reduced in number. According to the CME FedWatch, there’s now only a 49.5% probability of a 25 basis points rate cut in September.
The Crypglass data unveiled that the crypto market experienced approximately $40 million in liquidations within the recent hours, amounting to a significant $180 million over the past 24 hours. Amongst these liquidations, $125 million long positions and $55 million short positions were terminated within the last day. Notably, Ethereum, Bitcoin, Pepe Coin, Solana, and Dogecoin spearheaded the liquidation statistics.
Approximately 64,000 traders saw their positions closed, with the largest single termination taking place on the BitMEX exchange for a trade worth $4.26 million in XBTUSD. Consequently, the crypto market experienced a minor downturn over the past few hours.
Analysts Reveal Sell Signals
As a financial analyst, I’d interpret John Bollinger’s perspective this way: Based on his technical analysis tool, Bollinger Bands, I observe a potential consolidation or correction in Bitcoin’s price action due to a two-bar reversal occurring at the upper band. This doesn’t signal bearishness from him, but rather a short-term concern as prices may retract before continuing their upward trend.
As a researcher analyzing the BTCUSD market, I’m not particularly fond of seeing the two-bar reversal occurring at the upper Bollinger Band. This pattern may indicate a potential consolidation or pullback in the near term. However, it doesn’t mean I’m bearish on the longer-term outlook for Bitcoin against the US Dollar; rather, my concern is focused on this short-term price action.
— John Bollinger (@bbands) May 21, 2024
Expert analysis by Ali Martinez indicates a sell signal from the TD Sequential indicator on Bitcoin’s daily chart. Caution is advised for traders dealing with Bitcoin.
Bitcoin might experience a decline in value over the next few days. On the other hand, altcoins may face a correction as investors cash out their profits following the recent price surge.
As a researcher studying the cryptocurrency market, I’ve noticed that the open interest for Bitcoin Futures on CME has declined by 3% over the past 24 hours. In addition, the total open interest for Bitcoin Futures has dropped by another 2%. The open interests for XRP, DOGE, and PEPE futures are experiencing substantial declines, while some altcoins have seen buying activity.
Read More
- SOL PREDICTION. SOL cryptocurrency
- USD ZAR PREDICTION
- USD PHP PREDICTION
- AVAX PREDICTION. AVAX cryptocurrency
- MNT PREDICTION. MNT cryptocurrency
- DPLAT PREDICTION. DPLAT cryptocurrency
- USD CHF PREDICTION
- WOO PREDICTION. WOO cryptocurrency
- PHB PREDICTION. PHB cryptocurrency
- ARKM PREDICTION. ARKM cryptocurrency
2024-05-22 17:34