After yesterday’s big jump, trading on the crypto market as a whole was steady on Thursday. This was because traders were taking stock of the market’s state and taking into account the headwinds facing the economy as a whole, which continue to show that trouble is on the way.
Crypto Stocks went up and down because corporate earnings kept coming out, but a better-than-expected GDP report from the U.S. gave traders some reason to be optimistic.
TradingView data shows that the price of Bitcoin (BTC) went down over the course of the day, from a high of $20,875 to a low of $20,263, a change of 2.95%. At the time this was written, the most valuable Crypto was worth $20,335.
Jim Wyckoff, a senior technical analyst at Kitco, noticed the top cryptocurrency’s weakness early on and thought it might be because it had hit a six-week high on Wednesday.
“Price action this week has seen a big and bullish “breakout” to the upside from the choppy and sideways trading range of the past few weeks,” Wyckoff said, adding that “A young price uptrend is now in place on the daily bar chart.” Bulls have the overall technical edge in the short term, which suggests that prices will go up even more in the short term.”
Although crypto Twitter is still arguing about whether the recent gains are just a “bull trap” or a sign that prices will soon go up. An anonymous crypto trader named “Moustache” posted the following tweet to show one sign that “the bear market/correction is over.”
All eyes are on the Fed
Marcus Sotiriou, an analyst at the digital asset broker GlobalBlock, said that so far, “the market has responded positively to this news, possibly because the chances of an economic recession have gone down.” This gives us more information about how things are going since the U.S. GDP grew by 2.6%.
Sotiriou warned that the reaction might not last long. However, gains in the markets mean that the Fed can keep going with its aggressive plan to raise interest rates.
“Core PCE inflation was 4.5%, which is in line with this argument. It was lower than the previous month’s 4.7%, but it has stayed high,” the analyst said.
Sotiriou warned that “risk assets, like crypto, could react badly after the short-term volatility is gone” if the Federal Reserve keeps raising rates quickly. This is because an aggressive Federal Reserve policy takes away liquidity from the market, which causes the most liquid assets, like crypto and stocks, to be sold off.
Sotiriou says that one good thing about crypto is that governments all over the world are trying to become the next global hub for crypto. For example, the UK has officially recognized Bitcoin and Ethereum as financial instruments that need to be regulated, and Hong Kong is trying to get the top two cryptos listed on trading platforms.
“I think government regulation could be a big reason why more people start using Crypto in the next few years,” Sotiriou said in conclusion.
Crypto Altcoins consolidate
On Thursday, the prices of most altcoins were within 3% of what they were the day before, with a few notable exceptions.
Klaytn (KLAY), which went up in price by 26.45% to $0.2594, was the best performer among the top 200 coins. The price of Dogecoin (DOGE) went up by 13.83%, thanks to excitement about Elon Musk buying Twitter and rumors that the social media site is working on adding a crypto wallet.
At the end of traditional U.S. markets, the Dow was up 0.61 percent, while the S&P and Nasdaq were both down 0.61 percent and 1.63 percent, respectively.
The total value of all cryptocurrencies is now $1,000,000,000,000, and Bitcoin has a 39.5% share of the market.