Crypto helped by dollar weakness

Market Picture

Crypto market capitalisation remained at $2.59 trillion on Friday morning, in line with the previous day’s values, despite a dip to $2.50 trillion overnight and a subsequent recovery on Friday morning. This contrasts with the slide in stock indices because a falling dollar supports cryptocurrencies. Like a rising tide, the dollar’s decline is lifting other assets.

Sentiment in the crypto market has returned to the extreme fear zone, sending the index to the 25 level.

Bitcoin has been rising since early Friday, climbing above $81.4K, after closing just below $80K on Thursday. However, the first cryptocurrency has yet to confirm a growth reversal. The key area along the way is the $85K level, where the 50-day moving average passes. Its overcoming will be an important confirmation of the bullish sentiment, while fluctuations below it will remain market noise.

XRP and Tron found support this week on the decline to the 200-day moving averages. This small but encouraging signal suggests that market participants are still adhering to a ‘buy on dips’ strategy, believing in the continuation of the bullish trend.

News Background

• A combination of on-chain metrics and technical indicators point to the need for Bitcoin to return above $93K to regain upward momentum, Glassnode noted. The correction has intensified selling by medium-term holdings, but their activity is slowing.
• New Bitcoin sell-offs are possible in the coming weeks, but the bear market is likely to start in September, according to ‘il Capo of Crypto’. The analyst attributes this to the expected process of ‘global economic reset’, which may be accompanied by a major crisis – the first in BTC history.
• The US Senate has approved the nomination of Paul Atkins to the post of SEC chairman. He is expected to focus on developing permanent standards for the regulation of digital assets.
• The SEC authorised the listing and trading of options on spot Ethereum-ETFs from BlackRock, Bitwise and Grayscale. In September, the regulator already gave a similar authorisation for derivatives based on BTC-ETFs.

The FxPro Analyst Team