Nasdaq pressure pulls Bitcoin and Ether down

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On Monday, we saw colorful confirmation of the impact of market dynamics on Ether and Bitcoin. After the Nasdaq fell over 2% intraday, the two major cryptocurrencies dropped their psychologically significant levels, retreating to $ 3,000 and $ 40,000, respectively.

However, in all cases, the fall was redeemed. The Nasdaq closed on a nominal decline, and Bitcoin very quickly returned to levels near $ 42K. Ether is currently trading at 3100, gaining more than 1% since the start of the day.

The larger technical picture has not changed, indicating locally an oversold, putting buyers on the run who have been waiting for a discount in recent days.

The crypto market as a whole has lost 0.6% in the past 24 hours, but since the start of the day it has added 1.6% to $ 1.96 trillion from the decline to 1.86 trillion dollars at the peak of the decline on Monday. evening.

The cryptocurrency fear and greed index dropped 2 points in one day, falling to 21. It is still extreme fear just like yesterday and a week ago.

In our opinion, bitcoin and ether are bought locally by enthusiasts and a number of long-term strategic investors, while investment funds trade them based on surges in demand or risk aversion.

Overall, this puts cryptocurrencies at the same level as growth stocks, sensitive to interest rate dynamics: the rise in profitability causes a liquidation of risks. At the same time, we must not forget that cryptocurrencies are more mobile, that is, they sometimes lose two or three times as much as the Nasdaq.

If so, cryptocurrencies are far from at an all-time low as the process of normalizing interest rates in financial markets is far from over.

This article was submitted by Alex Kuptsikevich, Senior Market Analyst for FxPro.

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