Bitcoin is bombing once again – proving if anything, that the world’s most popular digital asset is a great vehicle for volatility and swing trading. While it could be the overall slumping markets as traditional assets are lower too, or perhaps it is the fact that the SEC has once again slammed the door on a Bitcoin ETF thus blocking a path for more retail participation, things aren’t looking good for crypto.
Marcus Sotiriou, Analyst at the UK-based digital asset broker GlobalBlock (TSXV:BLOK), distributed a comment on the crypto markets asking the rhetorical question if more pain is in the way:
“Bitcoin fell further this morning to $19,000, as it trades below the 200-weekly SMA. So far, Bitcoin has not retested this level as resistance, but if it does and rejects back down, this would be a very bearish signal. This is because it would be the first time that this level has been broken on a long-time frame and could suggest an extended bear market is on the horizon,” said Sotiriou. “There is a “risk off” tone in European markets this morning which has contributed to sell pressure on U.S. stock market futures and the crypto market. Spain’s year-over-year headline inflation for June came in at 10.2% which is significantly higher than the expected 9% as well as May’s 8.7%. This is contrast to Germany’s year-over-year CPI data showing a decrease from 8.7% to 8.2%, and less than the expected 8.8%. Despite Germany’s reading coming in lower than anticipated, the ECB (European Central Bank) will be forced to raise rates. This means that a recession is more likely to occur in Germany as growth is due to slow. Inflation in Spain, Belgium and France soaring to the highest levels since the 1980s led ECB President Christine Lagarde to concede yesterday that “low inflation is unlikely to return”. This has resulted in more fear around European economies in the near future.”
Looming regulation pertaining to crypto exchanges and the inevitability of more enforcement actions on the way for digital asset issuers combine with horrible market conditions to drive crypto markets lower – not to mention several digital asset platforms that have imploded. The bottom is not yet in.