Pressure on US tech stocks was a significant theme in US trading yesterday, dragging cryptocurrencies down. The Crypto market capitalisation adjusted 1.1% overnight to $2.05 trillion.
Bitcoin is losing 2% overnight, down to $42.8K, and ether is losing about 1.5% to $3.3K. Other top coins are declining with much less amplitude, as investment fund darlings rather than crypto enthusiasts have been hit the hardest.
The Doge, which has become accepted as a means of payment for some (inexpensive) Tesla goods, deserves a separate story. Some have noted that goods for Doge are selling out even faster than for dollars. On this news, the coin is adding 18% today at $0.20, near the highs for the month.
This news is a good illustration of crypto's continued penetration of corporate culture. On the other hand, Tesla won't necessarily hold these coins forever. People will be more active in spending their investments in DOGE.
The technical view of the ETHUSD is disappointing because the selling intensified earlier in the week while it tried to break the 200 SMA again. The dip and consolidation below suggest a break of the bullish trend formed in May 2020, when the pair consolidated above this line.
In a worst-case scenario, it could be a road to $1300-1700, about half of the current levels. It is doubtful that in this bear market cycle, the price of ether will lose 95% of its peak, as it did in 2018, which could completely nullify the rise from 2020.
Bitcoin's disposition is no less worrisome. A death cross forms in it as the 50-day dips below the 200-day. At the same time, the price is below these averages, which reinforces the bearish signal. Attempts earlier in the week to form a rebound are encountering more substantial selling, further indicating seller pressure.
The bearish picture in Ether and Bitcoin makes the entire cryptocurrency sector appear cautious in the near term. Individual growth stories, like DOGE, run the risk of quickly losing strength today when the overall backdrop turns negative.
This article was written by FxPro’s Senior Market Analyst Alex Kuptsikevich.
