Cryptocurrency’s future remains uncertain as investors across asset classes remain pessimistic.
There has been a 2% drop in the price of Bitcoin in the previous 24 hours.
A short-term neutral bias inside a negative long-term trend is supported by the fact that Bitcoin has steadied after a response to a short-term oversold indicator last week, according to the managing partner of technical analysis company, Fairlead Strategies Katie Stockton.
Given the recent big fall below $27,200 and the persistently bearish intermediate- and long-term momentum, the risk remains substantial, according to Stockton’s latest report.
The stock market’s falls have coincided with Bitcoin’s drop to its lowest levels since 2020. Because of concerns that the Federal Reserve’s plan to keep raising interest rates in the face of historically high inflation will trigger a recession, the S&P 500 SPX –0.30% is now in a bear market.
Digital assets, like stocks, are likely to suffer as much in a recession. Significant losses on leveraged positions and difficulties among crypto financial service providers are only two of the many factors aggravating the situation for cryptos.
“Bitcoin is a hazardous asset with a high link to stocks, which means it probably won’t be receiving any support any time soon,” said Edward Moya, an analyst at Oanda. This indicates that Bitcoin will be stuck in its narrow trading range for the foreseeable future since investors’ appetite for risky assets has faded.
Everything else in the crypto world went on as usual. To $1,200, the second-largest digital currency, EthereumETHUSD +1.96 percent, dropped less than 1 percent. When ERC-20 reached a high of $2,000 in November 2021 (after trading at $4,900 a month earlier), it was trading for around $900 as of June 18th.
There were even fewer smaller cryptos, known as altcoins, in circulation. Cardano was down 2%, while Solana was down 5%. More than that, the price of meme coins like Dogecoin DOGEUSD and Shiba InuSHIBUSD plummeted by more than six percent.