Cryptocurrencies under pressure from risk-off sentiment

Cryptocurrencies were under pressure on Thursday from the risk-off sentiment that prevailed in markets. Stock markets were once again volatile on Thursday, with Apple’s shares dropping nearly 5%. Risk sentiment remains uncertain, creating turbulence in stock markets and crypto markets alike. On Thursday, cryptocurrency prices dropped early in the day but managed to recover later in the day.

Bitcoin price fluctuated around the $19,400 level on Thursday. If BTC declines further, support can be found at $17,600, while resistance may be encountered near $19,700. 

Ethereum price exhibited low volatility on Thursday, hovering around the $1,320 level. If the Ethereum price declines, it may encounter support at the psychological level of $1,000. If Ethereum's price increases, resistance may be encountered near $1,407.

Ethereum price had been boosted in anticipation of the merge from the Proof-of-Work to the Proof-of-Stake method. The hype created around the merger had created a bullish sentiment for the cryptocurrency, which deflated following its completion, triggering a selloff.

The US Fed raised its interest rate by 75 basis points last week, driving down crypto markets. Steep rate hikes increase global recession concerns, putting pressure on risk assets, such as cryptocurrencies. The Fed’s rate hike was largely expected and had already been priced in by markets. Cryptocurrencies have been retreating for the past couple of weeks in expectations of a hawkish Fed outcome and so the effect of the rate hike was somewhat muted. The EU, the UK, Switzerland, and Canada have also tightened their monetary policies recently. 

BTC/USD 1h Chart

ETH/USD 1h Chart

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Written by:
Myrsini Giannouli

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