Yesterday, Bitcoin briefly fell below 56,000, and then rebounded to 58,000. At the same time, Nvidia's stock price plummeted by nearly 10%, driving the overall decline of technology stocks and quickly affecting the crypto market. Bitcoin and altcoin prices have all pulled back, and Ethereum has tested the support level of 2,300. We mentioned before that 1900-2300 is a good buying opportunity. Currently, the Ethereum Foundation is selling ETH again. Will Ethereum start with 1 next? ? ?
Nvidia's plunge was mainly affected by two factors:
First, concerns about economic recession are heating up again.
Second, there are rumors that the US Department of Justice will file an antitrust lawsuit against Nvidia, although Nvidia denies receiving a subpoena.
Coupled with weak US manufacturing data and insufficient market confidence, investors chose to sell after the August holiday, further exacerbating the decline.
In addition, the Bank of Japan's interest rate hike expectations are also an important factor leading to global market turmoil. The Bank of Japan reiterated that it will consider raising interest rates if prices continue to rise and the economy improves. This statement pushed up the yen and affected global markets, especially exacerbating the decline of Bitcoin, S&P 500 and Nasdaq.
At the same time, political factors cannot be ignored. The rising probability of Trump's election has caused market concerns about the direction of policy. Some people speculate that the Democratic Party may gain an advantage by manipulating the market before the election, and there are even rumors that the US government may sell off the remaining Bitcoin before the election to create trouble for the Trump camp. These speculations have not yet been confirmed.
The US Jose job vacancy data for July released yesterday fell to the lowest level since the beginning of 2021, and layoffs increased, indicating a weak labor market, raising expectations for a 50 basis point rate cut. However, the market still needs to pay attention to this Friday's non-farm payrolls data and next week's August CPI inflation data. In addition, the ADP "small non-farm" data tonight may trigger market fluctuations.
September is usually a month of poor performance for cryptocurrencies, and the Fed's monetary tightening policy has further suppressed Bitcoin's trend. The movement of Bitcoin spot ETFs has become a key variable, especially Blackrock's capital flow affects the market. Since the end of August, Blackrock has not made large-scale purchases, but has shown signs of capital outflow, but Tuesday's trading day did not show obvious outflows.
Bitcoin currently holds $58,000, and the biggest pain point has dropped to this position, becoming a key support. $59,000 is the average purchase cost line of Bitcoin spot ETFs. After breaking it, buying weakened, coupled with the influence of US economic data and the stock market, the price fell. $59,000 is a key area that needs to be recovered as soon as possible.
Although Bitcoin barely holds up, the pressure on altcoins has intensified, especially after the launch of the Ethereum spot ETF, funds have continued to flow out, further suppressing the market. The entire crypto market is showing a bear market pattern similar to the third quarter of 2023. Although the short-term performance is poor, it may accumulate the foundation for a long-term bull market.
If Ethereum falls below $2,300, it will hit the 200-week moving average, which will become a buying opportunity in batches. The growth in the supply of stablecoins, especially the rise in the market value of USDT, and the increase in global liquidity have laid the foundation for the market to rise. The Bitcoin MVRV score indicator shows that the 30-day moving average has fallen below the one-year moving average, signaling a price decline, and some people believe that a rebound may be imminent.
The Fear and Greed Index is at a low level, indicating fear in the market, which often means that the bottom is approaching and becomes a buy signal. By observing the perpetual contract funding rate, the data shows that BM's funding rate rebounded from the falling range, which may indicate that Bitcoin is about to rise.
Although there may be a risk of further decline in September, Bitcoin is still in a reasonable valuation range. History shows that the peak of the bull market is accompanied by extremely high valuations, and this cycle has not yet reached the peak. If the bottom is completed in September, it may enter a rebound phase in the future.
Most institutions believe that September is an opportunity to attract investment. Companies such as Big Finex and K33 pointed out that the early buying strategy in September often brings good returns in the fourth quarter, especially from October to April of the following year, when the market performance is strong.
The FTX creditor situation may bring further liquidity to the market. Although the SEC opposes creditors receiving compensation in cryptocurrencies, the return of these funds may stimulate market demand.
That’s all for today’s article. We are currently in a bull market, and things are turbulent. We share passwords every day.
