Bitcoin rose during the day as buyers rushed in to get the crypto after it had fallen earlier. Bitcoin had recently fallen to its lowest point in six months. This was due to fears of a Russian strike on Ukraine and ahead of the Federal Reserve meeting this week.
After falling to $32,951 (its lowest value since July 23), the leading virtual currency was once again up 2.5 percent at $37,250. Losses from the all-time record of $69,000 in November have already exceeded 50%.
Is it Now Safe?
Bitcoin has reached a critical point, according to experts, where more selling might change the long-term bull general pattern.
On Monday, the digital currency dropped due to growing tensions between Russia and Ukraine. NATO said it was increasing the number of ships and fighter jets in Eastern Europe and placing troops on alert. Russia characterized the behavior as evidence of increasing tensions in Ukraine.
Nervousness about the Federal Reserve’s two-day policy conference, which begins on Tuesday, also added to the situation. The Federal Reserve of the United States is anticipated to confirm that it will soon begin reducing the pool of liquidity. This move has fueled the rising stocks.
Marc Chandler, head market strategist for Bannockburn Global Forex in New York, said that the concern seems to be how extreme the tightening is. He believes that if the Fed reduces the quantity of its balance sheet, circumstances will tighten, leading to higher interest rates.
Bitcoin’s Risky Assets
Cryptocurrencies, like other risky assets, have fallen since “individuals are holding off on uncertainty in general,” he noted. In midday trade, stocks too recovered off their lows.
The way this weekend, according to Katie Stockton, founder of the technical analysis firm Fairlead Strategies, is critical. It will be important to see if it closes over $37,400. this will determine whether the selloff is a correction in an upward movement or the start of a bear trend.
This is because the Ichimoku cloud bottom provides backing above that point. If Bitcoin fails to climb above this point, “the long-term progression is basically undone by that collapse,” she explained.
According to Coinglass’ most current data, about $465 million in digital currencies were sold in the last 24 hours. Bitcoin transactions are responsible for $167 million of the total.
Smaller virtual currencies, which typically move in ways consistent with bitcoin, also fell. However, not as much as bitcoin. Ether, the second-largest digital currency, was recently trading at $2,160, down 3.5 percent from its July 27 high.
The US stock exchanges trade Riot Blockchain, Bit Digital, and Marathon Digital. They have also recovered from recent lows. Coinbase Global, a cryptocurrency exchange, has recovered most of the day’s losses.
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