The cryptocurrency market has been hit hard Friday with a dramatic drop in prices. Bitcoin (BTC) was down 4.5% in the mid-$22,000s, while Ether (ETH), the token that powers the Ethereum blockchain, lost 4.7% with trading in the upper-$1,500s. Total market capitalization was $986 billion, a decrease of 4.4% or around $43 billion.
The price plunge has brought with it a spike in liquidation of trader positions. According to coinglass.com, long positions on the crypto futures markets with a value of over $210 million were closed by the 2nd of April.nd This is the highest since late March.
Experts said that the release of certain bitcoin from Mt Gox, the exchange that was hacked many years ago, could have added to the selling pressure. In any case, Bitcoin is now 11% lower than its peak level above $25,000, while Ethereum is now about 10% below its highs of the mid-$1,700s. This is due to concerns about the Fed’s interest rate policies.
Can Stock Rally Support Crypto?
It’s true that US stocks have been rising this year, which has helped to lower crypto prices. But major indices are still far from their peaks. Analysts believe traders are more optimistic about the future. This is because the Fed has not indicated that they plan to take interest rates above 5.5%, the current level the market is pricing in. Meanwhile, recent figures such as the ISM monthly services report have lowered the risk of a US recession later this year.
This could be a positive sign for cryptocurrencies. If the US economy continues to show strength, Ethereum’s price could go up as traders become more willing to take risks. In the short-term, though, this may be offset by the liquidation of $210 million in long positions, which could generate more volatility in the market. Traders should stay up to date on news and the market’s reaction.
Recent volatility in the cryptocurrency market has seen $210 million liquidated in Ethereum, leaving traders and analysts wondering what direction ETH could take in the coming days and weeks.
The good news is that the US stock market rally could continue, as recent technical developments for the S&P 500 have been positive. The Index received support from its 200-day Simple Moving Average (SMA), and a long-term downtrend has been broken, which could indicate the bulls have more room to run.
Price Prediction – Where Is ETH Headed Now?
The Shapella hard fork, which is the last major public Ethereum testnet, is scheduled for later this month and is a prerequisite for the mainnet upgrade next month. The main feature of the upgrade will be the ability to withdraw staked ETH, which could lead to short-term sell pressure as ETH investors cash in on their withdrawn ETH/ETH profits.
Despite this, it is expected that the introduction of flexible withdrawals will encourage more investors to stake ETH and lock up a larger portion of the supply. This could result in increased scarcity and higher prices.
On the other hand, the recent drop in ETH has seen it break below the uptrend that had been in effect since the start of the year. There is a potential for the price to test the February lows of $1460 in the near future.
Other Alternatives To Consider
ETH could still perform well in the coming months, but traders looking to make quick profits may want to explore other high-potential tokens that are being sold pre-sale or are part of upcoming crypto projects. We have reviewed the best candidates on this list, which includes the top 15 cryptocurrencies in 2023.
The list is updated regularly with new altcoins or ICOs and is compiled by the Cryptonews Industry Talk team.
Disclaimer: The Industry Talk Section features insights from key players in the crypto industry and is not part editorial content. Cryptonews.com.
