Cryptocurrencies struggled to rebound last week, as unstable market sentiment drove cryptocurrency prices down. Global stock markets extended gains on Monday, pushing cryptocurrency prices up. The announcement that Beijing would lift Covid restrictions, boosted investors’ sentiment. Crypto markets have been known to follow the overall trends of stock markets and especially of tech stocks.
A strong risk-off sentiment has prevailed over the past few months due to geopolitical tensions, driving investors to safer assets and dampening the appeal of cryptocurrencies. As however the crisis drags on, and risk sentiment is slowly returning to markets, causing volatility in cryptocurrency prices.
Bitcoin climbed above the $30,000 key psychological support level on Monday, rising to $31,600. If Bitcoin price declines, support may be found further down near $26,700, while resistance may be found at $40,000 and further up near $48,200.
Ethereum price also climbed on Monday, reaching $1,900. If the Ethereum price declines, support may be found near $1,720, while resistance may be encountered near $2.960 and higher up at $3,174.
The shift of major central banks towards a more hawkish fiscal policy has been putting pressure on cryptocurrencies over the past few months. Most major Central Banks are turning towards a tighter policy and a return to pre-pandemic interest rates, driving cryptocurrency prices down.
The Fed has raised its benchmark interest rate by 50 base points and the BOE also increased its interest rate by 25 bp. The ECB has also indicated that it will move towards a more hawkish policy, increasing market expectations that it will raise its interest rates in July. This week, the ECB’s monetary policy meeting on June 9th is expected to affect crypto markets as well.
BTC/USD 1h Chart
ETH/USD 1h Chart
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