The cryptocurrency market’s top 100 digital assets saw a notable downturn, dropping approximately 5% over the past week, marking its most significant decline since April, according to data compiled by Bloomberg.
As of 7:05 a.m. Monday in London, Bitcoin, the market leader, experienced a 2% decrease, trading at $62,275, its lowest in over a month. This decline was attributed to a six-day streak of outflows from US ETFs tracking the token.
The recent weakness in cryptocurrencies coincides with uncertainty surrounding the Federal Reserve’s ability to swiftly reduce interest rates from a two-decade high. Analysts view this retreat in digital assets as a potential indicator of weakening risk appetite across broader markets.
David Lawant, head of research at FalconX, described the current crypto market as characterized by low volatility, subdued trading volumes, and significant order book imbalances during price movements.
Specific cryptocurrencies have shown pronounced declines: Ether and Solana are experiencing their longest streaks of weekly losses since last year and 2022 respectively. Despite upcoming launches of the first US ETFs directly investing in Ether, and Solana’s recent popularity among digital-asset hedge funds, these assets continue to face downward pressure.
Bitcoin, which reached a peak of $73,798 in March, now lags behind traditional assets such as stocks, bonds, and gold in performance this quarter. Market analysts are now closely monitoring the 200-day moving average around $57,500 as a potential support level for Bitcoin’s price, as noted by Tony Sycamore, Market Analyst at IG Australia Pty.
In summary, the cryptocurrency market’s recent downturn reflects broader economic uncertainties and cautious investor sentiment, highlighting ongoing challenges for digital assets amidst evolving market conditions.
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