On the first day of trading on Wall Street in the second quarter, after new U.S. economic data prompted investors to reduce their bets on interest rate cuts this year, the S&P 500 and the Dow fell one after another. The S&P closed down 0.2%, the Dow fell 0.6%, and Nas The Dow Jones Composite Index edged up 0.1%.
The overall crypto market is declining. Bitcoin is almost close to testing the key support level of $68,000. It once fell to $68,089.00 during the day. As of the closing time of the US stock market, it was still hovering below $70,000, with a 24-hour drop of 1.8%. Ethereum (ETH) fell by 1.54%. Falling below $3,600, XRP fell by 2.36% and ADA fell by 2.63%. Coinglass data shows that in the past 24 hours, the entire crypto market has liquidated positions of US$316 million, of which bulls accounted for the majority, reaching US$257 million.
Traders lower rate cut bets
The biggest data point affecting the market today is the ISM manufacturing index. The index rose 2.5% to 50.3% in March, exceeding all economists' expectations. The index exceeding 50% indicates that manufacturing managers believe that the manufacturing market is expanding.
Driven by this data, the U.S. dollar index DXY exceeded 105 for the first time since November 2023, rising 0.49% on the day. The U.S. 10-year Treasury bond yield hit a two-week high, rising 13.1 basis points on the day to 4.325%.
The ISM report is not government data that feeds into the Commerce Department's quarterly economic growth data. But they are closely watched by investors, who view the data as a sign that the economy is doing well and the Fed may not need to cut rates to help the economy despite higher rates over the past few years. Bond traders are now pricing in a less than 50% chance of a rate cut in June 2024, a shock to markets that had expected as many as six rate cuts.
Last week, Federal Reserve Chairman Jerome Powell emphasized in his speech that the Fed hopes to lower interest rates only after it is more confident about inflation trends. Strong labor market conditions mean that there is no current urgency to cut interest rates.
Holidays lead to reduced liquidity
Well-known trader Daan Crypto Trades said that the Easter holiday may be a factor in the market correction in these days.
He said on the
Meanwhile, BTC/USD is currently trading at its lowest levels since March 25, and Daan Crypto Trades believes that a break below the 200-period moving average on the 4-hour time frame (currently $67,330) is not out of the question. He said: "The price is testing the 4H/1D trend here, and it will be more of a trial and error before the price returns to above $70,000."
Meanwhile, trading firm QCP Capital warned of increased “downward pressure” on cryptocurrency spot markets in its latest “New York Color” update to Telegram channel subscribers, saying: “Over the past 24 hours, , we are seeing strong interest in selling call options and buying put options on BTC and ETH.”
‘Smart Money’ Targets Buying on the Dip at $62,000
By tracking Binance trading order book liquidity, Material Indicators charted BTC price action between now and the upcoming block subsidy halving.
In a series of The bid to add to the position dropped to $62,000.”
Alan went on to say that Bitcoin may cause problems for institutional buyers as the price fluctuates in relatively unknown territory, but once the halving comes and goes, people will be firm in their belief in new all-time highs.
He commented: “At least one entity thinks this is a strong possibility, as their target price for the BTC accumulation position has been reduced to $62,000 after the price briefly fell below $69,000, which, among other things, shows Even institutions are not sure where the price will fall back, so they are happy to take DCA positions in this range because there is high belief that a new ATH will emerge after the halving.”
BTC will soar to $150,000 after halving
Morgan Creek Capital CEO Mark Yusko said in an interview with CNBC that although the price of Bitcoin is still below last month's historical high, based on its historical performance, the price of Bitcoin after the halving may surge to $150,000.
He analyzed: “The big moves happen after the halving, and by the end of the year, its trend will start to become more... parabolic. And, historically, it’s about nine months after the halving, so during Thanksgiving, Christmas At some point, we will see a price peak before the next bear market."
As for Morgan Creek Capital’s strategy for dealing with the bull market, Yusko revealed that they have allocated 80% of their investment portfolio to private equity and 20% to high-liquidity tokens. The main tokens of focus include Ethereum (ETH), Solana (SOL) ) and Avalanche (AVAX).
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