Bitcoin broke a 12-day slide, taking a breather to bounce along with the rest of the cryptocurrency market after a record-breaking string of declines. Analysts cautioned that the relief could be brief.
The world’s largest cryptocurrency climbed as much as 12% early Sunday, offsetting some of its losses from a sharp drop on Saturday that brought the coin as low as $17,599. As of 9:15 a.m. in New York, it was $19,500. Ether, which was as low as $881 in a sell-off, climbed 15% to $1,040, while alternative coins from Avalanche to Solana also benefited. Even with the surge, bitcoin is down almost 40% this month and is down more than 70% from its all-time highs in November.
“For those who prefer to buy low and sell high, I think most can agree that it is now the former,” said Mati Greenspan, founder of Quantum Economics.
The crypto market is known for its wild swings – especially on weekends, when moves can be amplified – and the whipsaw of the past two days provided the latest example. Nevertheless, the overall tone remains negative, with monetary tightness providing macro headwinds and raising concerns about a growing crisis within crypto.
According to CoinGecko, trading this weekend has been heavier than usual, with bitcoin volume reaching $40 billion in the past 24 hours, as of around 9 a.m. New York time. Last Saturday and Sunday, turnover stood at $25.6 billion and $22.5 billion, respectively.
Bitcoin’s decline on Saturday pushed the coin below $19,511, the highest level it reached during its last bull cycle in 2017, reaching the end of that year. During its nearly 12-year trading history, bitcoin has never fallen below the previous cycle peak. Katie Stockton, Managing Partner and Founder of Fairlead Strategies, said that the coin even broke the $18,300 technical support level. He added that continued weekly losses below that level would increase the risk of a fall to the next support level of $13,900.
Now to trade, Stockton said a short-term, “counter-trend” technical signal “provides some hope that a rally will emerge in the near-term.” However, he cautioned against buying the downside, as “the momentum is strongly negative.
The toxic mix of bad news cycles and high interest rates has hurt crypto. The Federal Reserve raised its main interest rate by three-quarters of a percent on June 15 – the biggest increase since 1994 – and central bankers indicated they would continue to hike aggressively this year in the fight to tame inflation. . Adding to the mood, crypto hedge fund Three Arrows Capital suffered major losses and said it was considering an asset sale or a bailout, while another lender, Babel Finance, followed in Celsius’ footsteps on Friday.
According to CoinGecko, a risk-off sentiment from redemption pressure in Tether could be seen due to the more than $15 billion drop in circulation of the widely used stablecoin since the May collapse of the Terra ecosystem. Some of this $4.4 billion in redemptions happened in the past seven days.
This story has been published without modification in text from a wire agency feed.