Crypto markets closed lower this week after the Federal Reserve dashed investors’ hopes for multiple rate cuts in 2024.
Bitcoin fell to its lowest level in nearly a month on Friday. During the U.S. stock trading session, BTC fell more than 2% from around $67,000 to $65,100 in one hour, and the 7-day drop reached 7.5%. As of press time, it is still hovering below $66,000.
Altcoin fell across the board. Among the top 200 Altcoin by market capitalization, Rocket Pool (RPL) rose 27.9%, Notcoin (NOT) rose 12%, and io.net (IO) rose 5.9%. Mog Coin (MOG) led the decline, falling 13.8%, followed by Echelon Prime (PRIME), which fell 13.1%, and cat in a dogs world (MEW), which fell 12.9%.
The current overall market value of cryptocurrencies is $2.38 trillion, with Bitcoin accounting for 54.2%.
CoinGlass data shows that in the past 24 hours, market turmoil has caused nearly $180 million in liquidations across the network, most of which are long positions betting on rising prices. This week's volatile trend has liquidated more than $870 million in positions.
As for U.S. stocks, as of Friday's close, the Dow Jones Industrial Average initially closed down 0.15%, the S&P 500 fell 0.04%, and the Nasdaq rose 0.12%.
Holders sell for profit
Bitcoin has experienced a sharp decline, falling more than 7% in the past week, while U.S. stocks hit new highs. "A variety of specific factors such as profit-taking by holders and increased selling by miners have led to the sluggish BTC price," said analysts at Secure Digital Markets.
Data from analytics firm CryptoQuant shows that the amount of BTC that has been inactive for at least 12 months and two years has decreased, suggesting that holders are taking profits as Bitcoin prices remain close to their peak. In addition, on June 10, miners sold at least 1,200 BTC through over-the-counter transactions, setting a record for the highest single-day trading volume in more than two months.
Outflows from the U.S. spot BTC ETF also put pressure on Bitcoin prices, with a total of $226.6 million flowing out of ETF products, the highest amount in two weeks.
“With Bitcoin’s 50-day moving average around $66,000 , there is a possibility of a rally to its 20-day moving average around $69,000. However, a break below this level could trigger a bearish signal, pushing Bitcoin prices down towards $63,000 or even $60,000,” the analyst said.
'Summer doldrums'
Analysts at QCP Capital predict that the distribution of Bitcoin and Ethereum options suggests that the cryptocurrency market may be on the verge of a summer lull in trading activity.
The QCP report states that traders expect relatively more price volatility for ETH in the coming months. However, the analysis adds that any higher volatility premium for ETH relative to BTC could decline as prices rise driven by the approval of the spot Ethereum ETF S-1 form.
QCP Capital said traders might consider accumulation as a strategy, saying: "We are heading into a quiet summer with low volatility and no catalysts to move the market."
Patience is recommended
As Bitcoin’s correction continues to grow, most analysts believe that the consolidation period is about to end. Market analyst Elon Trades released the following chart showing Bitcoin’s price action at the end of 2020.
ElonTrades analysis said: “It retraced 15%, retraced another 10% before starting to rise, which is not much different from today except for the length of time it hovered at the previous all-time high; the former was about 21 days and the latter was about 100 days. I think this is also one of the reasons why people think this will be a cycle with a slightly lower breakout point and a longer duration.”
“Until proven otherwise, 65k is support. If this support holds, we should expect another move higher,” CryptoCapo said in its Telegram group.
Author: BitpushNews Mary Liu
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