Cryptos have been under pressure since the beginning of the year, hit by a bout of risk-aversion. The bulls have attempted several times to reverse the downtrend, with little success so far. The recent volatility in stock markets, and especially the fall of tech stocks has been affecting crypto markets, which seem to have developed a strong dependency on stock market trends.
Mounting geopolitical tensions have been driving the price of cryptos down, as investors shy away from risk assets. The recent developments in the crisis between Russia and Ukraine have put even more pressure on cryptocurrencies. On Monday, Russian President Vladimir Putin signed a decree recognising the independence of the two separatist regions Donetsk and Luhansk in eastern Ukraine, and ordered Russian troops in these regions, violating Ukraine’s sovereignty and effectively launching an invasion against Ukraine. Crypto markets are on the decline following these developments, as demand for risk-assets falls and investors turn towards safe-haven assets.
European stock markets and US futures rose early on Wednesday, stabilising after the latest Russian developments, although volatility indices remained elevated. Later in the day, US stock markets fell and European stocks retreated, affected by the crisis in Ukraine. Bitcoin and Ethereum prices climbed early on Wednesday and dipped later in the day, showcasing once more the growing affinity between stock markets and crypto markets.
Bitcoin fell above $39,000 on Wednesday and then retreated to the $37,000 level. If Bitcoin price declines, it may find support at $36,000 and $33,000, while resistance may be found at $40,000.
Ethereum price plummeted to the $2,570 level, trading below the $2,640 support. In case ETH price continues decreasing, further support may be found around $2,300. In case its price goes up, it may find resistance at $3,000 and further up at $3,400.
BTC/USD 1h Chart
ETH/USD 1h Chart
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