Investing.com – Wave of sales to start the week. On Monday it fell almost 9% and once again fell below the 200-day moving average (currently at $ 45,804.90). On Tuesday, the decline continued unabated until moderate price stabilization settled at the 20-week smoothing level at $ 40,455.
At around 7:28 am CET, it lost 1.81% to $ 42,225. The low for the day was formed on the Bitfinex exchange at $ 40,281. Since the beginning of September, the world’s largest cryptocurrency by market capitalization has lost 10%.
Bitcoin’s losses also changed the mood in the cryptocurrency market, as measured by the Fear and Greed Index, from “Neutral” to “Fear.” However, this is usually a contraindicator. If there is too much fear in the market, BTC may fall below the level where crypto traders believe it should be priced fairly. Currently, the index is at 27 points. As soon as the index drops below 20, you can often expect a first floor.
Things are looking so bleak for him and him: ETH and ADA lost a good 10 percent in trading yesterday and now face some major technical marks.
If the Ethereum price permanently closes below $ 3,060 / $ 3,075, a reversal formation in the form of SKS will complete. This would translate to a possible downside of around $ 1,000. In this case, the target price is $ 2025.
Ethereum is currently trading at $ 2,994.
Cardano is also at an important crossroads. If it falls below $ 2.03, the selling pressure should extend to the August 18 low of $ 1.87. Currently, ADA / USD is trading just above $ 2.07.
Evergrande crisis, Fed meeting and debt ceiling weigh on risky assets
Cryptocurrency traders said uncertainty remains in the market due to the liquidity crisis at Chinese real estate giant Evergrande (HK: 3333), which is unlikely to be able to meet an $ 83 million interest payment owed on a bonus on Thursday. This, combined with the Fed meeting scheduled for Wednesday and the threat of a US default. If no agreement can be reached on raising the debt ceiling during October, it has weighed on the assets of risk at the beginning of the week.
The S&P 500 fell 1.7%, its worst day since May 12 this year. At the low of the day, the broad stock index was 5% below its intraday high. It is currently 4.1% below its peak.
The index fell 614 points, or 1.8%, its biggest daily decline since July 19. It was down 2.2 percent.
Investor nervousness is also reflected in the performance of the: The fear index reached its highest level since May on Monday, and the ProShares Ultra VIX (NYSE :) short-term futures ETF rose 16.3% on Monday. .
The next test for the stock and crypto markets is on Wednesday’s agenda with the Federal Reserve’s monetary policy decision.
Investors are waiting for more details from the chairman of the board, Jerome Powell, about the central bank’s plans to reduce its bond purchases, especially when it does. The Fed’s asset purchases are seen as the main driver of the recovery in the equity and crypto markets from the Corona lows in March. Powell said last month that he expected the Fed to cut its monthly purchases by $ 120 billion by the end of this year.
And given the ethical crisis the Fed undoubtedly faces after it was revealed that two regional bank presidents, Robert Kaplan in Dallas and Eric Rosengren in Boston, actively speculated on stocks last year, when the Fed adopted its emergency program that has led the action. Markets to many records: The central bank is now under pressure to finally set a concrete timetable for reducing stimulus measures.
In addition to the interest rate decision at 8:00 pm, the Fed will also publish its quarterly economic forecasts, as well as the “dot chart.” Then, Mr. Powell will give a press conference.
Bitcoin – technical perspectives
As Investing.com wrote in a price analysis yesterday, the $ 40,750 area provides key support for bitcoin and with a dip below it, the upper reversal would gain significant contours.
On the upside, the 50- and 200-day line barrier at $ 46,633.4 / $ 45,806.3 must be broken based on the closing price to allow the technical charts pendulum to swing back in favor of Bitcoin bulls.