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Bitcoin's price chart showed that the cryptocurrency price dropped on Monday. (CoinDesk)
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Featured SpeakerAlex ThornHead of Firmwide ResearchGalaxy
Hear Alex Thorn share his take on "Bitcoin and Inflation: It’s Complicated” at Consensus 2023.Secure Your Seat
Bitcoin’s (BTC) rally above $30,000 has stalled – at least temporarily.
The largest cryptocurrency by market capitalization was recently trading at around $29,500, off 2.6% over the past 24 hours. Bitcoin began sinking on Sunday and dropped as low as $29,292 before rebounding slightly, according to CoinDesk data.
Encouraged by mildly upbeat inflation data last week, investors sent bitcoin’s price over $30,000 for the first time since last June. The surge from $28,000, however, was “largely untested,” Joe DiPasquale, CEO of crypto-asset manager BitBull Capital, wrote in an email to CoinDesk.
“Even though it breached $30,000, the price was likely to look for support on the downside and potentially consolidate before another leg up,” DiPasquale said, adding that with bitcoin recently sticking around mid-$29,000, most indicators on hourly time frames, such as the Relative Strength Index and Stochastic RSI, hint at a spike upward.
“What the bulls will want to see is a strong bounce from between the $28,000 and $29,000 range and a reclaim of $30,000 in the coming days,” he said, although he also noted that bitcoin’s price could decline to $23,000 before rebounding. In that case, “it may take longer for the upside to materialize,” he said.
Coinglass data showed that traders who bet on shifts in price have liquidated over $32 million worth of BTC long positions since Sunday evening versus $1 million of BTC short positions. These types of long squeezes tend to send prices lower.
Riyad Carey, a research analyst at crypto data firm Kaiko, said that several macroeconomic factors, including Monday’s U.S. dollar jump and a mixed bag of first-quarter earnings results, might have sent bitcoin’s price downward. The U.S. Dollar Index and bitcoin’s price is negatively correlated, Carey told CoinDesk, adding that that correlation has decreased since the start of the year.
Elsewhere in markets
Ether (ETH) was recently hovering at about $2,084 Monday, down 0.7% in the past 24 hours but holding steady after the Ethereum blockchain’s major software upgrade last week. Among other altcoins, Avalanche’s AVAX token recently rallied over 7% to $20.70. Perpetuals-focused decentralized exchange dYdX’s DYDX token rose by 5% to trade over $3.
The CoinDesk Market Index (CMI), which measures the overall crypto market performance, was down 2% in the past 24 hours.
After surging late last week, crypto-related stocks also dropped on Monday: Shares of exchange Coinbase (COIN) and bitcoin mining firm Marathon Digital Holdings (MARA) lost over 3%. MicroStrategy (MSTR), a business software company that holds a large amount of bitcoin, fell 5%.
Equity markets were mixed as investors awaited earnings reports from a number of major banks, including Bank of America (BAC) and Goldman Sachs (GS). The S&P 500 and tech-heavy Nasdaq were down 0.1% and 0.2%, respectively. The Dow Jones Industrial Average was flat.
Edited by James Rubin.
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