The crypto market traded lower over the weekend, with US inflation data, possible moves by the US Federal Reserve (Fed), and bearish-looking technology stocks all weighing on investors’ sentiment and causing worry about the way forward.
On Monday at noon UTC, bitcoin (BTC) was down by 3.7% for the past 24 hours and by more than 11% for the past week, trading at USD 41,099. At the same time, Ethereum (ETH) was down 6% for the past day and more than 13% for the week to a price of USD 3,057.
The moves over the weekend followed last week’s signals from the Fed that the central bank will not let up on its planned tightening measures.
Commenting on the outlook for the US economy, Cleveland Fed President Loretta Mester said that she believes a US recession can be avoided even as the Fed continues to tighten. “It’ll be challenging, but we can do it,” she said, per a Bloomberg report.
Bitcoin 2022 fails to excite traders
Perhaps surprisingly, the major industry conference Bitcoin 2022, held in Miami from Thursday to Saturday last week, did not translate into excitement among bitcoin traders.
Leading up to the event, BTC fell hard on Wednesday, before trimming some of its losses as the conference kicked off on Thursday. As of Friday, however, the bears came back in force to push the coin down again, with selling continuing on Sunday and Monday morning in Europe.
As usual, the selling over the weekend led to spikes in liquidations of leveraged bitcoin derivatives traders on exchanges. According to data from Coinglass, more than USD 40m of bitcoin long positions were liquidated during 12-hour periods on both Friday and Monday.
The liquidations followed a USD 60m liquidation of long bitcoin positions in 12 hours as the market fell hard on Wednesday last week.
Center going to US expansion
Strikingly, the moves in bitcoin and the more extensive crypto space additionally come as the market anticipates new expansion numbers in the US on Tuesday this week.
As the month prior, the figure is supposed to be high, with the agreement among examiners being a perusing at the purchaser cost list (CPI) of 8.4%, as per Bloomberg.
Albeit by and large accepted to be great for hard resources, for example, bitcoin, rising expansion is causing worry among market players since it could drive the Fed to act forcefully to cut down costs.
“[T]he Fed is gotten in a difficult situation with regards to handling runaway expansion without sinking the economy,” Antoni Trenchev, overseeing accomplice at the crypto loaning and acquiring firm (NEXO) told Bloomberg in remarks today.
As indicated by the exchanging group at the crypto trade, there is “a feeling of apprehension” that has” crawled into the market amid low volumes throughout the end of the week.”
That’s what the group contended,
“The possibility of more financing cost climbs and expanding worries over the monetary climate might become repeating subjects during the current year. Similarly, as with the securities exchange, we might see more flare-ups of roundabout unpredictability in the months to come.”
There is some certain information, in any case, as they likewise contended that, as bitcoin reception keeps on developing, “the hidden strength of the biological system could recognize it from ordinary business sectors.”
BTC and tech stocks connection develops
As far as it matters for bitcoin, the moves throughout the most recent week have to a great extent followed those of the securities exchange, and all the more explicitly the innovation weighty Nasdaq 100 record.
In any case, this is not another thing. There has been a reliable positive relationship between BTC and tech stocks beginning around 2019, with the connection just developing further last week as the two business sectors fell couple.