Macro-induced mayhem costs Bitcoin bulls dearly as Ethereum also loses key $3,000 support.
Bitcoin (BTC) headed toward $40,000 on April 22 after a major retracement in equities speared bulls’ latest advance.
BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView
Bitcoin sheds $3,000 on U.S. stocks plunge
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD being kept firmly under $41,000 on April 22 after volatility during the latest Wall Street trading session.
April 21 had seen United States markets react sharply to “surging” Treasury yields, the Nasdaq 100 dropping 2% and taking highly-correlated crypto down with it.
US stocks fall in a dramatic reversal as yields surge. Nasdaq 100 drops 2% as US 10y yields jump by 7bps to 2.9%. pic.twitter.com/vlgaW9F62C
— Holger Zschaepitz (@Schuldensuehner) April 21, 2022
With that, Bitcoin briefly lost over $3,000 in a matter of hours, wicking to around $39,800 before recovering.
Another macro trigger, meanwhile, came in the form of the Federal Reserve’s balance sheet reduction finally getting underway. Also set to pressure stocks and risk assets, the move to combat forty-year record inflation was long priced in but was not visible in the data until now.
“Looks as if Fed balance sheet expansion has stopped shortly before the $9tn mark is reached,” markets commentator Holger Zschaepitz summarized on the day.
Could $ETH dip to $2600 this month?
After all, Sept' 2021 has shown how volatile retests of the black ~$3000 level can be to the downside (Chart 1)
Revisiting ~$2600 could still be a possibility if #ETH Weekly Closes below the Ascending Triangle top (Chart 2)#Crypto #Ethereum pic.twitter.com/2cUq9lZvBG
— Rekt Capital (@rektcapital) April 21, 2022
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