The financial markets continued to experience unpredictable fluctuations, causing a divergence in the price movements of crypto assets and equities. The recent decline in the crypto market seems to be linked to the press conference held by Federal Reserve Chairman Jerome Powell on June 14, where he announced that the central bank would temporarily halt interest rate increases for June. Although this decision was in line with what investors anticipated, the crypto market surprisingly changed direction and resumed the downward trend that has been ongoing for the past three weeks.
On June 16, the price of Bitcoin initially exceeded $25,000 but subsequently experienced a brief decline below that threshold. Analysts accurately foretold this drop to $25,000, considering the prevailing BTC derivatives data. This marked the first instance in three months that Bitcoin fell below $25,000, but it has since recovered and returned to this important price level. After the announcement of Powell’s decision to pause interest rate hikes, options data on June 15 indicated a potential downside for the price of Bitcoin. After reaching its peak at $31,000 in April, the BTC/USD pair has experienced a significant decline of approximately 20%. As a result, market sentiment has been negatively impacted, leading to a proliferation of downward price forecasts during the intervening weeks. Adding to the downward pressure on the price, miners have been selling off their Bitcoin holdings since the beginning of June. Several factors could have triggered this situation. One potential factor is the decreased earnings resulting from a decline in overall mining activity and the mining hash rate reaching an all-time high. The rise in Bitcoin difficulty has also played a role, reducing miners’ profits and potentially increasing their losses. According to a recent report from behaviour analytics platform Santiment, Bitcoin whales have been capitalising on this situation by increasing their holdings. Despite the price of Bitcoin falling by approximately 10% during the period since April 9, these influential investors have managed to accumulate a significant amount of Bitcoin, specifically 57,578 Bitcoin.
Ether (ETH) has experienced a notable decrease of nearly 7% today, which can be attributed to a combination of fundamental and technical factors. Specifically, on June 15, the price of Ether declined by 1.7% to approximately $1,620, marking its lowest level in three months. This intraday drop in ETH price is part of a broader downward trend observed throughout the week, which was further accelerated by the Federal Reserve’s adoption of a hawkish stance in their recent statement. Over the past few years, Ether (ETH) has exhibited characteristics of a riskier asset, displaying a strong positive correlation with major U.S. stock indexes. The recent decline in Ether’s price over the past 24 hours has triggered a significant number of liquidations of leveraged long positions, amounting to $54.95 million on June 15. Simultaneously, the open interest of contracts tied to Ether experienced a decrease from nearly $6 billion on June 14 to $5.69 billion on June 15. This indicates that long traders opted to close their positions by selling ETH, which potentially contributed to the acceleration of the price decline.
On the macro front, Regulation has been a recurring topic in recent crypto news. The European Union (EU) introduced a digital asset framework called MiCA, outlining regulations in this domain. Meanwhile, the United States has taken a different approach by focusing on regulatory enforcement through the Securities and Exchange Commission (SEC). Given the prevailing macroeconomic challenges, the anticipation of forthcoming interest rate hikes, and the current low trading volume, it is highly probable that the volatility in the crypto market will persist in the foreseeable future. These factors contribute to an uncertain environment for crypto assets, making price fluctuations and market turbulence more likely.
Technical Outlook:
Bitcoin:
Bitcoin made a ‘Doji’ candle at the recent top of $31,000 (on 15th April) indicating indecision in the trend and has been trading in a downtrend since then. The prices have corrected almost by 20% and have made a low of $24,800. The asset has very strong support at the key level of $25,000 (Horizontal Trendline, 50% Fibonacci Retracement level and 200 Day Moving Average). Currently, BTC is trying to take support at this level and has not given a daily closing below $25k. If it holds, sustains and rebounds from here then we can expect some relief rally whereas a close below $25,000 will lead to further downfall and the prices can test the next support which is at $22,500. The asset has strong resistance at $28,500 and $32,500.
ETH:
ETH after making the recent top of $2,146 started trading in a downtrend and the prices plunged to $1,741. Post this move, the asset started consolidating and was trading sideways between $1,775 to $1,900. ETH finally gave a breakout below the range and broke the long-held key support of $1,725 (Horizontal trendline & 200-day Moving Average) and made a low of $1,628. The asset has support at $1,610 (50% Fibonacci Retracement Level) whereas $1,725 to $1,775 will act as a strong resistance zone for the asset.
BNB:
BNB made a ‘Tweezer Top’ candle at the recent top of $350 and it has been trading downwards since then. The asset was trying to take support at the psychological level of $300. However, the bulls failed to defend the level and it finally broke the support. After breaking the support of $300, BNB witnessed a sharp fall and made a low of $220 within eight days. The asset took the support exactly at the previous bottom of December 2022 and didn’t break the key level of $220 and bounced back from $220.4 up to $252.8 levels. Breakouts below $220 or above $255 with good volumes will further decide the trend for the asset.
Weekly Snapshot
| USD ($) | 08 Jun 23 | 15 Jun 23 | Previous Week | Current Week | |||
| Close | Close | % Change | High | Low | High | Low | |
| BTC | $26,508 | $25,576 | -3.52% | $27,407 | $25,435 | $26,770 | $24,797 |
| ETH | $1,846 | $1,666 | -9.79% | $1,912 | $1,780 | $1,855 | $1,624 |
| BNB | $262.15 | $236.28 | -9.87% | $308.40 | $256.10 | $263.92 | $222.07 |
| crypto | 1w – % Vol. Change (Global) |
| BitCoin (BTC) | -9.23% |
| Ethereum (ETH) | 7.48% |
| Binance Coin (BNB) | 24.57% |
| Resistance 2 | $32,500 | $2,000 | $0.95 | $285 |
|---|---|---|---|---|
| Resistance 1 | $28,500 | $1,750 | $0.70 | $255 |
| USD | BTC | ETH | Matic | BNB |
| Support 1 | $25,000 | $1,610 | $0.50 | $220 |
| Support 2 | $22,000 | $1,400 | $0.41 | $200 |
Market Updates:
- Starting June 15, users that are interested in Bitcoin mining but lack the equipment can subscribe to Binance’s cloud mining services and purchase hash rates for the same.
- Aave proposal to freeze alleged Curve founder’s loans draws controversy. The proposal suggests that a cap should be imposed on the use of CRV as collateral, preventing this wallet address from adding more loans.
- The Tether CTO was in the news again on June 15 after USDT slightly de-pegged by 0.3%. The loss of the dollar peg seemed to be triggered by the Curve 3pool imbalance which saw USDT weighted at 73.8% vs USD Coin & DAI.
- Together, exchanges such as Binance, OKX and Bitget have more than $2 billion combined in nominal fiat protection funds. Meanwhile, Huobi’s insurance fund is collateralized by 20,000 Bitcoin while Coinbase grants up to 150,000 British pounds ($189,140) worth of insurance to U.K. customers’ accounts.
