Bitcoin drops below key $61,000 level

Bitcoin rallied at the beginning of the week, but its rally was arrested on Wednesday. The cryptocurrency’s price dropped below the key $61,000 level as bears wrestled market control from the bulls. If BTC price declines, support can be found at $58,200, while resistance may be encountered at $64,700. 

Ethereum traded sideways on Wednesday, oscillating around the $3,380 level. If Ethereum's price declines, it may encounter support near $3,200, while if it increases, resistance may be encountered near $3,620.

Crypto markets plunged last week and continued to decline this week. The global crypto market cap has lost many billions of dollars in value in the past few days, dropping below $2.3 trillion.

Fluctuating risk sentiment is causing volatility in crypto markets. Cryptocurrency prices are affected by central banks’ interest rates. High interest rates are restricting economic growth putting pressure on risk assets, while the promise of rate cuts boosts crypto markets. The US Federal Reserve kept interest rates unchanged at its latest policy meeting, within a target range of 5.25% to 5.50%, as expected. Odds of a Fed rate cut in September are currently below 70%, while a rate cut by November is fully priced in. 

Crypto markets have been under pressure by the war in Gaza. Fears that the war will spread in the Middle East are promoting a risk aversion sentiment putting pressure on risk assets such as cryptocurrencies. Israel threatens to declare an all-out war with Hezbollah, which will destabilize the region further.

BTC/USD 1h Chart

ETH/USD 1h Chart

TRADE CRYPTO

The content provided in this material and/or any other material that this content is referred to, whether it comes from a third party or not, is for information purposes only and shall not be considered as a recommendation and/or investment advice and/or investment research and/or suggestions for performing any actions with financial products or instruments, or to participate in any particular trading strategy and cannot guarantee any profits. Past performance does not constitute a reliable indicator of future results. TopFX does not represent that the material provided here is accurate, current, or complete and therefore shouldn't be relied upon as such. This material does not take into account the reader's financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of TopFX, no reproduction or redistribution of the information provided herein is permitted.

Written by:
Myrsini Giannouli

Share the article: