Leading cryptocurrencies plunged alongside stocks on Wednesday, as investors await the Consumer Price Index report for hints on the Federal Reserve’s next moves.
Bitcoin Pumps And Dumps
Bitcoin saw a sharp jump to $90,000 in the early trading hours before reversing all the gains in a jiffy, triggering massive liquidations. The apex cryptocurrency sank below $86,000 later in the day.
Ethereum saw a similar trajectory, pushing past $3,000 only to crash below $2,800 eventually. Trading volume for the second-largest cryptocurrency rose 17% in the last 24 hours.
Shares of cryptocurrency-linked stocks Strategy Inc. (NASDAQ:MSTR) and Bitmine Immersion Technologies Inc. (NASDAQ:COIN) closed down 4.25% and 6.59%, respectively, during the regular trading session.
Benzinga Edge delivers real-time stock alerts, trade ideas, and professional investing tools to help you navigate the market. Find out more about MSTR and BMNR here.
Over $530 million was liquidated from the cryptocurrency market in the last 24 hours, according to Coinglass, with long liquidations accounting for nearly $385 million.
BTC’s rebound toward $94,000 would likely trigger nearly $2.30 billion in short liquidation, suggesting that derivatives traders were positioning for further declines.
Meanwhile, Bitcoin’s open interest fell 2.41% in the last 24 hours.
The “Extreme Fear” sentiment prevailed in the market, according to the Crypto Fear and Greed Index.
Top Gainers (24 Hours)
The global cryptocurrency market capitalization stood at $2.95 trillion, following a drop of 1.10% in the last 24 hours.
Stocks Fall Ahead Of CPI Print
Stocks faced additional downward pressure on Wednesday. The Dow Jones Industrial Average fell 228.29 points, or 0.47%, to end at 47,885.97. The S&P 500 lost 1.16% to finish at 6,721.43, while the tech-focused Nasdaq Composite shed 0.23% to end the day at 22,693.32.
Investors are eyeing Thursday’s November Consumer Price Index report, following the disappointing labor market data released earlier this week.
A cooler-than-expected print could boost expectations for a rate cut in January, which currently has only a 24% chance, according to the CME FedWatch tool.
Bitcoin Needs To Hold 80,000-$85,000 Level To Determine Next Moves
Hunter Rogers, co-founder of the Bitcoin yield protocol TeraHash said in a note to Benzinga that Bitcoin’s ongoing downturn is a direct consequence of the “absence of fresh demand,” where even mild selling putting pressure on the market.
“I think we’re now seeing an exhausted market. Short interest has increased,” Rogers stated. “All in all, what BTC needs now is to hold its key $80,000-$85,000 level. That would determine the price’s next direction.”
Michaël van de Poppe, a widely followed cryptocurrency analyst and trader, was not amused by Bitcoin’s sharp reversal, stating that the $88,000 barrier needs to be breached to gain momentum.
“If not, then the levels at $83,000 for liquidity and $80,000 for liquidity are the important ones to look at,” the analyst added.
Photo Courtesy: KateStock on Shutterstock.com
Read Next:
Coinbase Adds Stock Trading, Kalshi Event Contracts, Shares Climb BTCGrayscale Bitcoin Mini Trust (BTC)$38.160.46%Overview$BTCBitcoin$86288.000.10%$DOGEDogecoin$0.1260-0.21%$ETHEthereum$2831.60-0.01%$SOLSolana$123.770.45%$XRPRipple$1.860.02%COINCoinbase Global Inc$247.851.50%MSTRStrategy Inc$160.540.10%Market News and Data brought to you by Benzinga APIs
