Crypto Market Update: Bitcoin, ETH, and Altcoins Experience Declines
Bitcoin and other cryptocurrencies have seen a drop in value early Tuesday, despite significant inflows into Bitcoin-linked exchange-traded funds. The leading cryptocurrency, Bitcoin, has experienced a 3.6% decrease over the past 24 hours, now sitting at $66,867 after reaching a record high near $74,000 in mid-March due to increased interest from new spot exchange-traded funds.
Similarly, the price of Ethereum (ETH) is also on a downward trend, despite the recent approval of the spot Ethereum ETF by the SEC. ETH price has dropped by over 4.2% in the last 24 hours, currently hovering around $3,500, testing the patience of buyers. Other leading altcoins have also experienced declines, with SOL down by 4.8%, BNB falling by 5.8%, and both Toncoin and Cardano losing nearly 4% of their value.
Furthermore, even the meme coin sector, which had been performing well, is feeling the effects of the market downturn. Pepe prices have dropped by over 3%, while Shiba Inu and Dogecoin prices have fallen by 5.3% and 4.4%, respectively.
According to Coinglass data, liquidations have surpassed $213 million in the last 24 hours, with buyers closing around $190 million worth of long positions.
The Outflow from Bitcoin ETF
Data from Farside on June 10 revealed that Bitcoin exchange-traded funds (ETFs) saw a $64.9 million outflow, marking the first outflow since May 10 and ending a 19-day streak of inflows. Four ETF issuers were responsible for these outflows.
This bearish movement in the Netflow metric has led to a decrease in buying pressure for Bitcoin’s price, causing it to drop below the $70,000 milestone.
US Inflation Impact on Crypto Market
The upcoming Bureau of Labor Statistics report on the Consumer Price Index is expected to have an impact on the cryptocurrency market. Economists predict a 0.1% increase in prices for May, down from a 0.3% increase in April, resulting in a year-over-year increase of 3.4%, matching the rate from April.
The US Federal Reserve will release its FOMC statement, economic projections, and interest rate decisions, creating a battle between bears and bulls in the market. Continuous selling pressure has caused a decline in the fear and greed index, indicating a shift towards a ‘Fear’ sentiment.
ECB Rate Cut and Market Sentiment
The crypto markets experienced a downturn last week following the U.S. jobless claims report and the ECB rate cut. Despite the ECB’s neutral stance and no clear commitment to further easing, the rate cut has diminished the yield advantage of the euro.
The ECB’s more dovish approach compared to the Fed and the possibility of additional cuts have intensified selling pressure in the crypto market.
Hot Take: Navigating the Crypto Market Volatility
As a crypto investor, staying informed about market trends and external factors impacting cryptocurrency prices is crucial for making informed decisions. While market downturns can be challenging, they also present opportunities for strategic investments and portfolio diversification.
Keep a close eye on upcoming economic reports, central bank announcements, and regulatory developments to anticipate potential market movements. Consider setting stop-loss orders to manage risk and protect your investments during volatile periods.
Remember, volatility is a natural part of the cryptocurrency market, and with careful research and risk management strategies, you can navigate through these fluctuations and potentially capitalize on new opportunities.
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