The largest cryptocurrency, Bitcoin, is losing about 3% today and has fallen below $71,000. The broader crypto market's declines coincide with today's weaker sentiments in the indices. The yields of 10-year U.S. treasuries have risen in the last three days from around 4.1% to nearly 4.29%. Today's data from the U.S. economy showed that February's PPI inflation rose more strongly than expected, complementing Tuesday's 'hawkish' CPI report, which indicated persistent pressure in services excluding rents.
Today's labor market data turned out to be very solid, with initial jobless claims falling to 209,000 compared to 210,000 previously, and the number of continued claims dropping to a long-unseen 1.8 million. As a result, yields are gaining again, and the bond market is under pressure. The strengthening of the dollar and the rise in risk-free rates are not favorable to risky assets, and it seems that in the next few hours we might observe profit-taking by some ETF funds, which have been intensely accumulating Bitcoin lately; this could happen if Wall Street's weaker moods ahead of tomorrow's 'triple witching day' persist; however, this is still not a confirmed scenario.
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Bitcoin is testing the simple, exponential moving average SMA100 (black line), which has proved to be a fairly strong support level since the end of February. A plunge below $70,000 could potentially trigger a wave of profit-taking. On the other hand, a rebound towards $73,000 could open the way to new, historic highs.
Source: xStation5
Inflows into ETF funds (data until Friday, March 8) grew, although outflows from Grayscale ETF are clearly continuing.
Source: XTB Research, Bloomberg Finance LP
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