Echoes of Powell's comments interrupted crypto's rise
Powell's speech on Thursday night weighed on US markets and echoed on cryptocurrencies, leaving an emerging breakaway from a critical support line.
A decline in US stock indices added to the negative impact amid a speech by Fed Chairman Jerome Powell, who said he could aggressively tighten monetary policy at the May meeting. Bitcoin has lost 2.3% to $40,700 in the past 24 hours. Ethereum is down 2.4%, while other leading altcoins in the top 10 are down 0.4% (Terra) to 4.7% (Polkadot).
Total cryptocurrency market capitalisation, according to CoinMarketCap, fell 2.2% overnight to $1.88 trillion. Bitcoin's dominance index fell to 41.0% due to the first cryptocurrency's tight link to pressured stock markets.
The cryptocurrency Fear and Greed Index fell 1 point to 26 on Friday, after three days at 27 points (fear).
Earlier on Thursday, Bitcoin tested the highs of the past 11 days, around $43,000. During the day, BTCUSD crossed the 50-day average, which is often an indicator of a medium-term trend, but failed to close above it.
Due to pressure on the stock market, the first cryptocurrency fractured into a bullish scenario with a breakaway from the support line and a trend reversal. However, it is too early to completely write off the strength of the bulls, while the first bitcoin manages to hold above support.
According to Chainalysis, US crypto investors made a record profit of $46.9bn in 2021, followed by the UK with $8.1bn and Germany with $5.8bn. In Russia, investors earned $4.3bn. According to the Bank of Canada, most Canadians investing in bitcoin lack financial literacy. Meanwhile, more knowledgeable investors have little or no exposure to BTC.
Author
Alexander Kuptsikevich, a senior market analyst at FxPro, has been with the company since its foundation. From time to time, he gives commentaries on radio and television. He publishes in major economic and socio-political media.
