The global cryptocurrency market cap dropped 2.4% lower to $944.4 billion on Sunday evening, below the psychologically important $1 trillion mark.
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See Also: How To Get Free Crypto
Why It Matters: Bitcoin was seen trading below the $20,000 level and Ethereum below $1,500 at press time. The two largest coins by market cap have declined 3.2% and 5.2% since Friday’s closing.
On Friday, the selloff was triggered after U.S. Federal Reserve Chair Jerome Powell’s speech at the annual Jackson Hole Symposium.
Powell said, “Reducing inflation is likely to require a sustained period of below trend growth” — adding, “the role of the Federal Reserve keeping at it until the job is done.”
The central bank head said restoring price stability could require “maintaining a restrictive policy stance for some time.”
Powell’s words began a rout among risk assets on Friday, which has yet to abate. At press time, S&P 500 and Nasdaq futures were down 1% and 1.5%, respectively.
“Bitcoin weakened after Fed Chair Powell didn’t blink with his reiteration that the Fed will tighten policy to bring down inflation. Risky assets are struggling as Powell’s fight against inflation will remain aggressive even as it will trigger an economic slowdown,” said OANDA senior market analyst Edward Moya, in a note seen by Benzinga.
While testing the $19,000 level for Bitcoin seemed “inevitable,” to Michaël van de Poppe, the cryptocurrency trader said those waiting for the $14,000 Bitcoin are unlikely to see it.
He said, “Question is whether we’ll sweep the lows or just create a [higher low] (based on Total Market Cap 200-Week [moving average]).”
– Potential scenario on #Bitcoin, as we are facing a test of a weekly support level.
Testing $19K region seems inevitable.
Question is whether we’ll sweep the lows or just create an HL (based on Total Market Cap 200-Week MA).
– Everyone waiting for $14K. Seems unlikely. pic.twitter.com/1Bf9EuXWk6
— Michaël van de Poppe (@CryptoMichNL) August 28, 2022
On Ethereum, Justin Bennett extended a warning to his followers on Twitter. The trader said, “Please stop assuming that the [ETH] merge or [crypto] adoption will prevent more downside if the global macro environment continues to deteriorate. Valuations rarely run parallel to growth and global macro trumps crypto macro.”
Please stop assuming that the $ETH merge or #crypto adoption will prevent more downside if the global macro environment continues to deteriorate.
Valuations rarely run parallel to growth, and global macro trumps crypto macro.
— Justin Bennett (@JustinBennettFX) August 27, 2022
Cryptocurrency market sentiment took a turn for the worse going ahead into the fresh week of trading. Alternative.me’s “Crypto Fear & Greed Index” flashed “Extreme Fear” at press time. Last week, it signaled “Fear.”
As Bitcoin declined below $20,000, there’s been a rise in the number of “key whale addresses,” said market intelligence platform Santiment.
“There’s a correlation between $BTC’s price & the amount of addresses holding 100 to 10k $BTC, and they’re up 103 in the past 30 days.”
As #Bitcoin has danced around $20,000 this weekend, a positive sign is the growth in the amount of key whale addresses. There’s a correlation between $BTC‘s price & the amount of addresses holding 100 to 10k $BTC, and they’re up 103 in the past 30 days. https://t.co/B7hjXi758z pic.twitter.com/0ozMBG7Oct
— Santiment (@santimentfeed) August 28, 2022
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