Cryptocurrency market 5/4 CHK: Crypto and US stocks rallied, despite the risk of recession

Cryptocurrency market 5/4 CHK: Crypto and US stocks rallied, despite the risk of recession


2023-05-10 03:57:39

Bitcoin bounced to $28,500 following an encouraging jobs report, while Ethereum surpassed $1,900 for the first time since August 2022.

Cryptocurrency Market

The encouraging jobs report shows that the US economy may finally shrink, which is considered a positive signal for the market.

The Job Openings and Labor Turnover Survey (JOLTS) showed job openings fell 632,000 in February to 9.9 million, the lowest level since May 2021. The 9.9 million figure exceeded expectations for a drop to 10.4 million and signaled a persistently tight job market.

Bitcoin price is still consolidating in the $28,881 – $26,555 range. At the moment, BTC is selling trading just above $28,500, up more than 2% over the past 24 hours.

Amid local headwinds, Bitcoin price volatility and the recent inability to establish new local tops suggest that a breakdown is likely in the market.

If selling pressure increases, BTC could drop below the immediate support at $27,724 or below to the bottom of the range at $26,555. The lack of buying power could send the leading asset back to the 50-day Exponential Moving Average (EMA) at $25,339. Below this level, the next chance for the bulls will be the $24.201 support.

Conversely, the bulls show strength, Bitcoin is likely to break above the $28,881 resistance level. In this case, the market is likely to head towards $30,000. A daily candle closing above this level could invalidate the bearish thesis.

Meanwhile, ETH has touched $1,900 for the first time since August, establishing a local intraday top at $1,925. If the market is able to sustain the price and close above $1,862 will push ETH price above the upper Bollinger Band range, a bullish sign for the asset.

On-chain data from IntoTheBlock shows the next key resistance area between $2,046 and $2,902, where 8.5 million addresses previously bought over 26.69 million ETH at an average price of $2,537.

On the other hand, if investors take profits early, ETH price could correct towards the $1,753 support. A drop below this congestion will cause ETH to free fall towards the 50, 100, and 200-day EMAs at $1,687, $1,603, or $1,589, respectively.

The Ethereum Beacon Chain is currently receiving a significant amount of capital, which could lead to greater selling pressure as the staking unlocking takes place.

While this development is likely to strengthen Ethereum’s market position in the long run, the short-term impact could be massive selling pressure that negatively impacts the price of the cryptocurrency.

The Beacon Chain serves as the coordination mechanism for the new Ethereum network, ensuring the creation and validation of new blocks and rewarding ETH validators for maintaining network security. With the upcoming staking unlock, Ethereum holders will have the ability to withdraw their ETH from contracts, regaining control of their previously locked funds.

While the event is a bullish indicator for the asset in the long-term, it also has potential for short-term volatility, as investors may choose to sell their unlocked ETH. As a result, the market will experience increased selling pressure, resulting in a temporary drop in the price of Ethereum.

Ethereum’s rally has led to the altcoin and BTC markets in the green.

The most prominent is ICON (ICX), currently an asset that attracts many traders in Korea. This token has bounced up to 40% in the past 24 hours with trading volume of the ICX/won pair surpassing $420 million on Upbit. On the 7-day timeframe, ICX has bounced over 120%.
LidoDAO (LDO), Synthetix (SNX), Casper (CSPR), Rocket Pool (RPL), Curve DAO Token (CRV), THORChain (RUNE) are the projects with over 10% momentum on the day.

Other altcoins such as Arbitrum (ARB), Frax Share (FXS), Basic Attention Token (BAT), Convex Finance (CVX), 1Inch Network (1INCH), Optimism (OP), Vechain (VET), Aave (AAVE)… from 6-8%.

Macro factors

The Dow Jones Industrial Average fell nearly 200 points on Tuesday (April 4), as investors assessed the spike in oil prices and what that means for the global economy.

Ending the session, the Dow Jones dropped 198.7 points (or 0.59%) to 33,402.4 points; The S&P 500 lost 0.58% to 4,100.6 points. Both indexes ended a streak of 4 consecutive gaining sessions. The Nasdaq Composite Index fell 0.52% to 12,126.3 points.

The market fell after the latest jobs report. In February 2023, the number of vacancies fell below 10 million for the first time in nearly two years, a sign that the once hot labor market that supported the economy was beginning to slow down.

“The market is very sensitive to any small change in the direction they don’t want to see,” said Ed Yardeni, President of Yardeni Research.

The market is certainly resilient, with the major indexes rallying even in the face of persistent inflation, a banking crisis and higher interest rates.

This week, the energy market became another potential source of uncertainty, after OPEC+ announced it would cut output by 1.16 million bpd. On April 3, the WTI oil futures contract recorded its biggest gain in nearly a year after the news.

Gold prices continued to rise on Tuesday (April 4) and surpassed the key $2,000/oz level as the dollar and yields weakened, while weak economic data signaled that the Federal Reserve The US state (Fed) will raise interest rates more slowly despite concerns about oil-induced inflation.

Closing the session, the spot gold contract rose 1.8% to $2,020 an ounce, having hit a peak since March 9, 2022 of $2,024.8 at the start of the session. Gold futures added 1.9% to $2,038.3 an ounce.

Oil prices inched slightly in volatile session on Tuesday (April 4), as investors pondered OPEC+’s production cut plan.

Ending the session, the Brent oil contract inched up 1 cent to $ 84.94 a barrel. The WTI oil contract added 29 cents, or 0.4%, to $80.71 a barrel.

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