Risk sentiment soured on Monday, putting pressure on crypto markets. Markets are still digesting last week’s news, with Sam Bankman-Fried’s indictment followed by a rapid succession of Central Bank rate hikes.
Bitcoin prices slid below the $16,700 level support on Monday, dropping to $16,500. If the BTC price declines, further support can be found near $16,000, while resistance may be encountered at $17,400.
Ethereum price also edged lower, dropping to $1,170. If Ethereum's price declines, it may encounter support at $1,150, while if it increases, resistance may be encountered near $1,350.
Increased risk aversion sentiment has hit crypto markets hard after the recent collapse of FTX. The FTX token faced liquidity issues, triggering a generalized crypto market sell-off and undermining confidence in the crypto industry. The FTX collapse is likely to cause ripples in the crypto industry for some time, as FTX CEO Sam Bankman-Fried was arrested last week in the Bahamas and is facing criminal charges.
Three major Central Banks, the Fed, the ECB, and the BOE all raised interest rates last week, reigniting global recession concerns and driving risk sentiment down. Even though the rate hikes were already priced in by markets, hawkish ECB and Fed rhetoric point to further interest rate increases ahead.
Risk sentiment, however, is boosted by signs of China’s economic reopening. The Chinese government has eased some of its strident Covid regulations, abandoning its zero-Covid policy. The Chinese economy has suffered from prolonged lockdowns but reports that the government plans to provide support for the economy and raise hopes of economic recovery.
BTC/USD 1h Chart
ETH/USD 1h Chart
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