March 26, 2023
Cryptocurrency price growth, and market risk reduction
Hot Forex Review

Cryptocurrency price growth, and market risk reduction

While after last week’s gains, Ripple still gave back some of its earlier gains with a -0.27% loss on Friday, Bitcoin and Ethereum, both gained more than 0.50%, as stock markets also trying to close the week higher. While BTC is trading at its six-week highs, the US leading indices trading 1.3% higher on average.

USVIX is moving towards 26, and BTC trying to reach the 21K level.

While the price started to gain and there are still some investors that believe in another wave down, we have another group of buyers and investors who are not waiting for another bearish wave. According to on-chain analytics firm CryptoQuant, more BTC is leaving Binance in a single day than ever before with almost 55,000 BTC sales in one day. Also, we had 71,579 Bitcoins moved out of the derivatives exchange. Numbers tell us that we have more buyers in September than in any month in 2022.

The main reason for current bulls in the charts could be less risk. As we can see in the below USVIX chart. While data show a sharp decline in economic growth all across the globe, and central banks start easing their tightening policies market risk decreased. With decreasing risks, Bond Yields also started to slow down from last week’s highest above 4%, and US dollar Index also fell under 20-DMA at 112.
While still we cannot trust the current sentiment and changes, it seems that until the Fed meeting on November 1-2, sentiment can stay positive.

The main reason that I say we may not trust this sentiment is the latest data from the US economy. Q3 GDP at 2.6% and last week’s initial Jobless claims at 217K, both were better than estimates to confirm that economic condition is still healthy enough to handle more tightening policies. Especially no change in the PCE price index and Core PCE price index in September, compared with August, confirms that we have a long way to see the inflation under control.

Summarizing, economic data and market conditions and sentiments, it can be said that the downtrend has not much fan, but bulls also will need more confirmation, therefore, if you want to bet, you have more chance of price raise than a price reduction.

From the technical point of view, in the daily chart, BTC moves in a clear uptrend above 20-DMA, with the first resistance at 21,900 and the main pivot at 25,250. On the flip side, breaching under 18,500 will put the 14,000 in radars.

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