Pressure on US tech stocks was a major leitmotif in US trading yesterday, dragging cryptocurrencies down. Crypto market capitalisation adjusted 1.1% overnight to $2.05 trillion.
Bitcoin is losing 2% overnight, down to $42.8K and ether is losing about 1.5% to $3.3K. Other top coins are declining with much less amplitude, as investment fund darlings rather than crypto enthusiasts have been hit the hardest.
The Doge, which has become accepted as a means of payment for some (inexpensive) Tesla goods, deserves a separate story. Some have noted that goods for Doge are selling out even faster than for dollars. On the news, the coin is adding 18% as of this morning and is trading at $0.20, near the highs for the month.
This news is a good illustration of crypto’s continued penetration of corporate culture. On the other hand, Tesla won’t necessarily hold these coins forever. That is, people will be more active in spending their investments in DOGE.
The technical view of the ETHUSD makes you think sad because the selling intensified earlier in the week while it tried to break the 200 SMA again. The dip and consolidation below it suggests a break of the bullish trend formed in May 2020, when the pair consolidated above this line. In a worst-case scenario, it could be a road to $1300-1700, which is about half of the current levels. It is extremely unlikely that in this bear market cycle, the price of ether will lose 95% of its peak, as it did in 2018, which could completely nullify the rise from 2020.
Bitcoin’s disposition is no less worrisome. A death cross is forming in it as the 50-day dips below the 200-day. At the same time, the price is below these averages, which reinforces the bearish signal. Attempts earlier in the week to form a rebound are encountering stronger selling, further indicating seller pressure.
The bearish picture in Ether and Bitcoin makes the entire cryptocurrency sector look cautious in the near term. Individual growth stories, like DOGE, run the risk of quickly losing strength today when the overall backdrop turns negative.