Market Wrap: Bitcoin Trading Flat, Holding at $9.6K
Trading volume in the crypto market weakened Tuesday but bitcoin is still holding strong from a recent rally.
After a quick rally on Monday, bitcoin remains in bullish territory although trading was flat Tuesday.
Bitcoin (BTC) was trading around $9646 as of 20:00 UTC (4 p.m. ET), gaining 1% over the previous 24 hours.
At 00:00 UTC on Tuesday (8:00 p.m. Monday ET), bitcoin was changing hands around $9,675 on spot exchanges such as Coinbase. After a dip to as low as $9,571, the price rallied but failed to cross $9,700. However, bitcoin’s price is still well above its 10-day and 50-day moving averages, which is a bullish signal for market technicians.
Trading volume on Monday was only slightly higher than it had been over the past few days, with Coinbase spot bitcoin volume at $112 million. Nonetheless, it was the highest since June 15 when volume hit $171 million. For Tuesday, volume on Coinbase is at $63 million, according to data from aggregator Skew.
Exchange volume is certainly lower than a month ago, and traders are concerned about traditional equities possibly pulling bitcoin’s price lower should stocks drop. “Momentum looks good and the crypto market is a bit bullish,” said Sasha Goldberg, a senior trading specialist at crypto liquidity provider Efficient Frontier. “But the sentiment of the traditional markets hasn’t changed and it can stop this bitcoin run,” he added.
Bitcoin is by far outperforming traditional global equities markets, up 38% in 2020.
Michael Gord, CEO of crypto brokerage Global Digital Assets, says poor second-quarter reports for some public companies might drag stocks down and bring back some crypto price movements. “I think we’ll probably see more crypto accumulation until the Q2 earning reports for public companies are released, and then I’d expect more volatility for better or worse,” he said.
Meanwhile, major stock indices are all in the green Tuesday.
The Nikkei 225 of publicly traded companies in Japan climbed 0.50%. The index experienced gains in paper, transportation and real estate to close the day higher.
The FTSE 100 index in Europe rose 1.4%. Economic indicators in the manufacturing and retail sectors ticked up, prompting investor confidence.
The U.S. S&P 500 index gained 0.43%. Tech stocks had big gains on the day, including Apple, which rose 2.1%.
ETH/BTC trading pair gains on DeFi frenzy
Ether, (ETH) the second-largest cryptocurrency by market capitalization, was up Tuesday, trading around $244 and after climbing 0.65% in 24 hours as of 20:00 UTC (4:00 p.m. EDT).
The ether-bitcoin (ETH/BTC) trading pair is jumping to highs not seen since late May, which shows the strength ether is experiencing lately. This trading pair is available on almost all cryptocurrency exchanges and prices ether in terms of bitcoin - for example, 1 ETH currently equals 0.02528 BTC. It is a way for crypto traders to capitalize on price movements across the two largest digital assets by market capitalization. When a trader is bullish on ether relative to bitcoin, ETH/BTC is bought; those bullish on bitcoin relative to ether sell it.
The spike in ether versus bitcoin can be attributed to the Ethereum network’s decentralized finance, or DeFi, capabilities with services like lender Compound, said Matthew Ficke, head of market development for cryptocurrency exchange OkCoin.
"ETH/BTC as a trading pair is interesting as it is up,” Ficke told CoinDesk.“There is some growing market discussion around Compound's recent success driving more interest in DeFi applications, the majority of which run on ether, which is strengthening its price."
In commodities, oil is in the red 0.72% Tuesday as a barrel of crude was priced at $40.27 as of press time. Gold is trading up as the yellow metal climbed 0.90%, trading around $1,770 for the day.
U.S. Treasury bonds were mixed Tuesday. Yields, which move in the opposite direction as price, were down most on the two-year bond, in the red 3%.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.