Crypto markets volatile on unsteady risk sentiment

Cryptocurrency prices exhibited high volatility on Tuesday, as risk sentiment remained uncertain. Bulls and bears fought to gain market control on Tuesday, creating instability in the market. Curve Finance exchange suffered a breach earlier in the week. Three liquidity pools were hacked from the exchange, leading to $70 million in damage. The damage was eventually contained, but exposed the industry’s vulnerability, dragging down crypto markets.

Bitcoin price plummeted to $28,700 early on Tuesday but pared some losses later in the day, rising to $29,500. If the BTC price declines, support can be found near $28,600, while resistance may be encountered near $29,600. 

Ethereum price declined early on Tuesday, dropping to $1,820 but rallied later, climbing to the $1,850 level. If Ethereum's price declines, it may encounter support near $1,815, while if it increases, resistance may be encountered near $1,880.

The U.S. Federal Reserve raised interest rates by 25 basis points last week after holding its interest rate steady at its June policy meeting. Fed officials raised the central bank’s interest rate to a target range of 5.25% to 5.50% last week, the highest level in 22 years putting pressure on crypto markets. Increases in central banks’ interest rates sour risk sentiment, driving risk assets down. 

The Fed’s message moving forward was ambiguous, aiming to give the central bank flexibility towards adjusting its future monetary policy and adopting a data-dependent approach. Crypto markets edged higher towards the end of last week but failed to maintain an uptrend.

BTC/USD 1h Chart

ETH/USD 1h Chart

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Written by:
Myrsini Giannouli

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