Market update

Although crypto has been dealing with its own issues, macro factors appear to be having the biggest impact. The White House expects this week’s June CPI figures to be “highly elevated” and analysts are tipping 8.8%. The Euro has also fallen to parity with the US dollar for the first time in 20 years. Noelle Acheson, head of market insights at Genesis Global Trading said: “This could negatively impact the price of Bitcoin in dollar terms, which for the past couple of years has been negatively correlated with the dollar index.” Bitcoin traded as high as A$32.5K (US$22.1K) this week but is currently around A$29,485 (US$19.8K) which is pretty much where it was seven days ago. Ethereum fell 8.6% to A$1,620 (US$1.1K), XRP lost 6.2%, Cardano (-8.9%) and Polkadot (-10.8%). The Crypto Fear & Greed Index is at 16, or Extreme Fear.

Bitcoin saw its worst month on record in June with a 38% fall, while Ether lost 47%. Contagion continues among crypto lenders and economists increasingly believe the US may already be in a recession. Adding to the fun, the Reserve Bank of Australia has raised interest rates by 0.5% today and in Turkey, inflation is at an eye watering 79%. But there’s a sense things may finally be stabilising in crypto after an extremely volatile few weeks. “Overall caution is still the name of the game,” Susannah Streeter, a markets analyst at Hargreaves Lansdown, told CoinDesk. Bitcoin is down 4.9% to trade around AU$29,600 (US$20.3K) and Ethereum is down 5.7% to trade around AU$1,675 (US$1,155). XRP lost 9.5%, Cardano (-9.5%) and Solana (-7%). The Crypto Fear and Greed Index is at 14, or Extreme Fear.

Things are starting to settle down, but with the effects of various collapses, bad loans and forced selling still working its way through the system, anything could happen. Bitcoin finished down 3% to AU$29,945 (US$20.7K) on a week ago, while Ethereum also managed to close the weekly in the green for the first time in 12 weeks, and is currently up 2% to AU$1,710 (US$1,180). XRP was up 6%, Solana (6%) and Polkadot (-5%). Documenting Bitcoin points out that in December 2020 when Bitcoin was at the same price it is now the Fear and Greed Index was at 92 or Extreme Greed. It’s currently at 12 or Extreme Fear.

Sad news this week after Bitcoin died for the 455th time. This time it’s serious however with Google searches for ‘Bitcoin dead’ hitting a new record. It’s certainly been a historic week with BTC dropping well below the 2017 former all-time high, plunging to AU$25,640 (US$17,744) on June 19th (ETH fell to AU$1,293/US$896). The unprecedented drop calls into question various cycle halving theories and invalidates the maxim that “no one who invested in Bitcoin and waited four years has lost money.”  Over the weekend Glassnode reported AU$10.5B/US$7.325B in onchain BTC losses had been “locked in by investors spending coins that were accumulated at higher prices.” Bitcoin finishes the week down 11.5% to trade around AU$29,300 (US$20.4K) while Ethereum is down 10.4% to trade around AU$1,580 (US$1,100). However: Cardano was up 6%, Solana jumped 25% and Polkadot increased 9.8%. Various analysts suggest that relative altcoin strength means much of the BTC and ETH fall was due to forced selling and liquidations. After dipping to 6 out of 100 over the weekend, the Fear and Greed Index is now at 9 or Extreme Fear.

Bitcoin has stabilised by 4% in the past 24 hours, and finishes the week down 31% at US$22,150, or AU$32,060, which is roughly the lowest pricing since December 2020. ETH is down 35% this week and is trading around US$1,220 (AU$1,765). The macro picture looks bleak: May’s inflation rate in the US topped 8.6% and there’s speculation the Fed may hike interest rates by a whopping 0.75%. The S&P 500 is in a bear market, having lost more than 20% this year, and as a riskier asset class crypto has been hit even harder. The effects have been multiplied by the potential for lending platform Celsius to collapse and the possibility the ETH Merge may be delayed again. Everything has lost double digits: Cardano (-27%), XRP (-23%) and Polkadot (-20%). The Crypto Fear and Greed Index is at 7 or Extreme Fear. The overall market cap is at US$932 billion (AU$1.353T). With two weeks to go, this is shaping up as either the worst, or second worst quarter in Bitcoin’s history.

Bitcoin’s longest ever losing streak ended on Sunday with the cryptocurrency finally printing its first weekly green candle in 10 weeks. There’s now hope among traders that we’ve found the bottom and JPMorgan’s suggestion of a 30% upside for Bitcoin following the recent washout is right. However, Josh Olszewicz, head of research at Valkyrie Investments, thinks overall conditions aren’t favourable. “Uncertainty in the global economy due to high inflation and the likelihood we are in a recession, paired with the prevalence of central bankers raising rates, is likely going to force all assets downward at least through the end of the summer,” he said. The Reserve Bank of Australia is also widely expected to raise interest rates today. Bitcoin finished the week at AU$41,700 (US$29.9K) while Ethereum lost 11% to AU$2,450 (US$1,750). Cardano increased 1%, XRP fell 7%, Solana (-16%) and Polkadot was down 13%. The Crypto Fear and Greed Index is at 13, or Extreme Fear, up from 10 last week.