The cryptocurrency market sentiment has deteriorated today under the pressure of a strengthening US dollar and declining indices on Wall Street, where we are seeing a nearly 1.5% drop in S&P 500 futures and almost 2% declines in the Nasdaq 100 (US100). However, the biggest shock for the bulls has been the massive plunge in Ethereum’s price, which has fallen from around $3,200 last Friday to approximately $2,200 this morning. Although both BTC and ETH have recovered some of their losses, the overall sentiment remains very weak, with most smaller cryptocurrencies following Ethereum's lead and experiencing significant declines. The market fears that an escalating trade war could lead to a resurgence of inflation, which in turn could push the Federal Reserve to adopt a more hawkish stance, potentially harming the US economy.
Bitcoin and Ethereum ETF Inflows
Even positive ETFs net flows for both Ethereum and Bitcoin didn't stop the sell-off, triggered by short term holders liquidizations and long term holders profit taking.
Start investing today or test a free demo
Open account Try demo Download mobile app Download mobile appBitcoin Inflows: Over the last two sessions of last week, nearly $700 million flowed into Bitcoin. However, this has not translated into a price increase. (Source: XTB Research, Bloomberg Finance L.P.)
Ethereum ETF Inflows: ETF inflows into Ethereum have been positive over the past three sessions. However, they have yet to come close to the success of Bitcoin ETFs. (Source: XTB Research, Bloomberg Finance L.P.)
Technical Analysis: Bitcoin & Ethereum (D1 Chart)
Bitcoin (BTC): The price dropped today to levels unseen since November but reacted at a significant support level. However, if weak stock market sentiment persists, another test of the 200-day EMA (similar to the one on August 1, 2024) cannot be ruled out. This could mean a drop to around $80,000. On the upside, the $100,000 level remains a key resistance.
(Source: xStation5)
Ethereum (ETH): Ethereum tested the $2,250 zone today, which is a crucial resistance level based on previous price reactions and the 71.6% Fibonacci retracement of the 2023 upward wave.
(Source: xStation5)
This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.