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good morning. Here’s what happens:
Market moves: Bitcoin fell below $40,000 for a while as US stocks continued to slide thanks to the newly hawkish Federal Reserve.
Technical Takes: Bitcoin buyers can respond to short-term oversold signals, although the upside appears limited.
Watch the latest episodes From CoinDesk TV for insightful interviews with crypto industry leaders and analysis.
Bitcoin (BTC): $41.797 -0.2%
Ether (ETH): $3,077 – 2.6%
S&P 500: $4,670 – 0.1%
DJIA: $36,068 – 0.4%
Nasdaq: $14.942 + 0.05%
Gold: 1801 USD + 0.3%
Bitcoin fell again on Monday during US trading hours after a slight recovery over the weekend. The bearish price action came after US stock market losses deepened as investors prepare for action from the more hawkish Federal Reserve.
The most valuable cryptocurrency briefly fell below $40k in the early hours before easing back above $41,000. At press time, bitcoin was trading over $41,500, down about 1% in the past 24 hours, according to CoinDesk data.
Last week, the prices of the oldest cryptocurrency fell for six consecutive days after Federal Reserve minutes revealed that policy makers discussed large interest rate increases along with a faster pace of normalization of its balance sheet.
“Tightening of financial conditions is expected to negatively affect risky assets such as stocks and cryptocurrencies as they become less attractive than safe-haven bonds,” crypto-trading data firm Kaiko wrote in its weekly newsletter on Monday.
According to Kaiko, the impact of the Federal Reserve’s meeting in December sent the correlation between bitcoin and traditional assets to their highest levels in more than a year.
“The Federal Reserve’s December meeting had a strong impact on global financial markets, as traders reacted quickly to the prospect of monetary policy tightening,” Kaiko wrote. “During the volatility, bitcoin behaved aggressively like a risky asset.”
After bitcoin, most major cryptocurrencies were also in the red on Monday. Ether, the second largest cryptocurrency by market capitalization, fell below $3,000 sometime before back above $3,000.
Bitcoin settled above the $40K support; Resistance is near $45,000
Bitcoin (BTC) selling pressure is starting to fade after the price drop last week. The cryptocurrency maintains short-term support at around $40K, although the upside appears to be limited near $43,000-$45,000.
Bitcoin is down about 2% over the past 24 hours, although price action has been somewhat muted over the past few days.
The Relative Strength Index (RSI) on the four-hour chart is rising from oversold levels, which usually precede a short price bounce. On the daily chart, the RSI is in the most oversold territory since December 10.
Bullish momentum weakens given BTC’s 2-month long downtrend. This means that sellers can remain active around the resistance levels.
8:30 a.m. HKST/Singapore (12:30 a.m. UTC): Australia’s imports and exports (November)
8:30am HKST/Singapore time (12:30am UTC): Australia Retail (November)
8:30am HKST/Singapore time (12:30am UTC): Australian Trade Balance (November)
1pm HKST/Singapore time (5am UTC): Japan’s leading economic indicator (November)
11pm HKST/Singapore (3pm UTC): US Federal Reserve Chairman Jerome Powell testifies before Congress
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said and heard
“And if you do it right and long enough, like Ethereum or Binance, you may become too rooted to be able to get rid of it. In the current regulatory environment, it’s the best chance for blockchain companies to succeed. We did it differently. We tried to do it “correctly.” So, We have to close now.” (Entrepreneur Zoe Adamovich writes for CoinDesk about shutting down her latest venture, Neufund)… “There is an intense fear in the street about tech stocks. Tech stocks have been on an uptrend, and now Fed fears and a huge 10-year yield are shattering a party Technology as investors hit the sell button and head for elevators in unison.” (Wedbush Securities Managing Director, Dan Ives in the New York Times)…” Indeed, DAOs likely have some of the same principal agent problems that exist in the traditional world. In theory, customers can buy shares in a company and share in the benefits that come from tapping into their data as well. They can also vote for the management team. In practice, this rarely happens.” (Paul Brody, EY Global Blockchain Leader and CoinDesk Columnist)