Bitcoin (BTC) had a bumper session on Tuesday in conjunction with a strong global equities market thanks to Federal Reserve chair Jerome Powell’s shall we say diplomatic tone in an Economic Club of Washington speech.
Powell said he expected “significant declines in inflation” this year, but: “If we continue to get, for example, strong labour market reports or higher inflation reports, it may well be the case that we have to do more and raise rates more than is priced in.”
In an act of blind faith, the markets seemed to ignore the latter, or as Wayne Cole, chief correspondent at Reuters this morning said: “For markets these days if Powell is not all-out in-your-face hawkish, then he’s dovish. There’s no middle ground.”
Tech stocks had a good showing, with the NASDAQ 100 Technology Sector Index adding over 3%.
As for bitcoin, the BTC/USDT pair added 2% to close Tuesday at US$23,240, putting the benchmark cryptocurrency back in the 23-24k comfort zone and ending a five-day losing streak.
BTC/USDT has remained relatively unchanged this morning barring some incremental downside to US$23,220.
Bitcoin (BTC) remains well above November 2022 highs – Source: currency.com
Bitcoin bulls will be eyeing up the US$23,350 resistance point as the next hurdle to jump.
Ethereum added 3.5% yesterday and another 0.4% this morning to bring the ETH/USDT pair to US$1,680, with bulls hoping to make short work of the US$1,700 target.
ETH/BTC continues to be a strong trading pair, having hit an 18-day high this Wednesday.
Bitcoin’s market dominance against the entire cryptocurrency space has slipped to 43.2% in recent days. While not the lowest it has ever been, it still represents a 120 bps drop from year-to-date highs, and over five percentage points lower than the 2022 high seen in June.
Grayscale Bitcoin Trust (GBTC), the world’s largest bitcoin-only investment vehicle with nearly US$15bn in assets under management, added 1.8%, while the Grayscale Ethereum Trust (ETHE) added a surprising 7.2%.
The rally on Grayscale vehicles followed news that parent company Digital Currency Group is selling a portion of its stake in its various investment vehicles at a massive discount in order to fund debt obligations.
Altcoins show strength
The wider altcoin space showed post-Powell bullishness, with the market-weighted CoinDesk Market Index (CMI) adding 2.2% overnight.
Polygon (MATIC) remains the strongest performer among the large-caps network tokens, adding 5.4% overnight, although Cardano (ADA), Solana (SOL), BNB and Polkadot (DOT) also added green candlesticks.
Metaverse project The Sandbox (SAND) saw a massive 27% rally after co-founder Sebastian Borget took to LinkedIn to announce a partnership with the Saudi Arabia Digital Government Authority (DGA).
“It was a true honour to sign our MOU partnership ceremony between The Sandbox and the DGA during the #leap2023 conference, and we look forward to exploring, advising and supporting mutually each other in activations of the Metaverse!” wrote Borget.
Meme coin Shiba Inu (SHIB) has entered a corrective phase after soaring over 20% in the past week as investors geared up for the much-anticipated Shibarium protocol upgrade.
SHIB/USDT has now posted losses in three of the four last trading sessions.
Global cryptocurrency market capitalisation is currently US$1.09tn, while total value locked across as decentralised finance (DeFi) protocols is US$49.5bn, having added more than 2% overnight.
