The crypto market experienced a significant downturn on July 4, with total market capitalization falling by over 5.7% to approximately $2.114 trillion. This decline is largely driven by uncertain U.S. market conditions and outflows from spot Bitcoin ETFs. Investor concerns about U.S. inflation and interest rates are also exerting downward pressure on crypto prices. The current sell-off began on July 1, following comments from Federal Reserve Chair Jerome Powell, who indicated that more substantial data is needed before considering interest rate cuts in 2024, a development closely monitored by crypto investors.
Bitcoin’s price has declined by more than 9.5% over the past three days after reaching $64,000 earlier in the week. Data indicates that Bitcoin fell sharply from a high of $63,223 on July 2 to an intra-day low of $56,709 on July 4. Over the last 30 days, Bitcoin has seen an 18% drop, with daily trading volume decreasing by 32% in the same period. Several indicators suggest the possibility of a deeper correction, making a swift recovery from these losses unlikely in the near term. The data reveals that the BTC futures premium dropped to 7.5% on July 4 but remained in neutral territory. Significantly, it surpassed the 10% bullish threshold on July 2, although this was short-lived, lasting less than four days. The current futures premium is reminiscent of the period between June 21 and June 24, following a 15% price correction over 12 days.
On July 3, Ether fell by 4.24% to approximately $3,280, marking its most significant daily decline in three weeks. This drop brings Ether’s total decrease to roughly 18% from its local high of around $3,975, reached over a month ago. Key factors driving this downturn include concerns over a potential major Bitcoin market sell-off and its ripple effects on the broader crypto market, as well as signs of waning institutional interest in Ether.
Additionally, Markets opened with improved sentiment after the U.S. Q1 gross domestic product (GDP) exceeded expectations, registering a growth of 1.4%, as reported by the Bureau of Economic Analysis on June 27. This marks the slowest quarterly growth since spring 2022. In contrast, the real GDP saw a 3.4% increase in the fourth quarter of 2023. Initially, the U.S. Commerce Department had forecasted a 1.3% GDP growth rate for the period between January and March. Despite higher interest rates, the U.S. economy has shown resilience. The Federal Reserve raised its benchmark rate 11 times throughout 2022 and 2023, reaching a 23-year high to control the highest inflation levels seen in 40 years.
Technical Outlook:
BITCOIN:
Bitcoin corrected almost by 23% from its all-time high and dropped to $56,5502. The asset didn’t break the crucial support level of $56,000 and bounced back up to $71,979. However, the bulls did not succeed in breaking the all-time high and the asset struggled to sustain above the $70k mark and the prices witnessed another correction. BTC was consolidating and was trying to take support at $60,000 but yesterday it broke the support and made a low of $56,633. Bitcoin has a strong support at $56,000.
ETH:
ETH after making the recent top of $4,093 witnessed a sharp correction and the prices fell almost by 31% and dropped to $2,817. The asset took multiple support at $2,850 and started to trade in a ‘Descending Triangle’ pattern. ETH gave a breakout above the pattern and rallied up $3,977. The bulls however failed to cross the psychological level of $4,000 and the asset saw some profit booking and it dropped to $3,355. Post this move, the asset was trading in a range from $3,350 to $3,500. It broke the range on the downside and made a low of $3,040. ETH has a strong support zone from $3,000 to $2,850.
BNB:
BNB after making the new all-time high of $721 witnessed a sharp correction as it failed to give a weekly close above the previous all-time high of $691. The prices corrected almost by 23.5% and dropped to $551. Post this move, the asset was consolidating and was trading in a range from $550 to $586. BNB gave a breakout on the downside of the range and the prices dropped to $497. The asset has strong support at $500. If it fails to hold and sustain above this level then we may expect more downfall.
Weekly Snapshot:
| USD ($) | 27 Jun 24 | 04 Jul 24 | Previous Week | Current Week | |||
| Close | Close | % Change | High | Low | High | Low | |
| BTC | $61,605 | $56,978 | -7.51% | $65,007 | $58,602 | $63,777 | $56,778 |
| ETH | $3,445 | $3,055 | -11.32% | $3,543 | $3,244 | $3,513 | $3,055 |
| BNB | $580.80 | $513.99 | -11.50% | $592.77 | $552.94 | $587.28 | $512.42 |
| Crypto | 1w – % Vol. Change (Global) |
|---|---|
| Bitcoin (BTC) | 5.00% |
| Ethereum (ETH) | -7.23% |
| Binance Coin (BNB) | 1.56% |
| Resistance 2 | $66,500 | $3,750 | $1.00 | $691 |
|---|---|---|---|---|
| Resistance 1 | $60,000 | $3,350 | $0.75 | $550 |
| USD | BTC | ETH | Matic | BNB |
| Support 1 | $56,000 | $3,000 | $0.6 | $500 |
| Support 2 | $52,000 | $2,850 | $0.5 | $450 |
Market Updates:
- German lawmaker and Bitcoin activist Joana Cotar has urged the government to stop its “hasty” Bitcoin selling spree and instead adopt it as a “strategic reserve currency” to shield against risks in the traditional system.
- The collapsed Japanese crypto exchange Mt. Gox has transferred 47,229 Bitcoin worth $2.71 billion at current prices — to a new wallet address in its first major transaction since May.
- Ethereum developers have introduced a new Ethereum improvement proposal, EIP-7732, which aims to overhaul the block validation process and speed up the blockchain.
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