Bitcoin, Ether Hover Above Support Amid China Optimism, US Futures Bump Up

Crypto markets added 3.2% on Tuesday after nearly a week of declines.

AccessTimeIconMay 17, 2022 at 12:06 p.m. UTC
Updated May 17, 2022 at 4:19 p.m. UTC

Shaurya is an analyst/editor for CoinDesk's markets team in Asia.

Bitcoin (BTC) held above the $30,000 level as indexes in Asian, Indian, European and U.S. markets turned green on Tuesday, data showed.

Traders priced in expectations of a relaxation of rules in Shanghai after weeks of strict lockdowns, leading to a jump in Chinese stocks. Policymakers in Beijing are taking steps to alleviate the economic slowdown with various moves in the past week.

Optimism around China helped create positive sentiment in the broader Asian market, as Hong Kong’s Hang Seng rose as much as 6% and India’s Sensex jumped 2.5%. Indexes in Japan and Shanghai added nearly half a percentage point each.

Elsewhere, Europe’s Stoxx 600 was up 1.5% in midday trading, S&P500 futures gained 1.5%, and the tech-heavy Nasdaq added 1.9%.

Lately correlated nearly 1:1 with broader equity markets , cryptocurrencies were ahead 3.2% after nearly a week of declines that saw bitcoin fall to as low as $24,000. At the time of this writing, the largest crypto was trading at $30,300. Ether (ETH) added 2.2% in the past 24 hours to trade above $2,000, with similar gains for Avalanche’s AVAX, BNB Chain’s BNB and dogecoin.

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Bitcoin hovers above psychological support at $30,000. (TradingView)

Polygon’s MATIC (MATIC) gained 5.5% as Polygon Studios CEO Ryan Wyatt said the firm was working with Terra projects affected by last week’s implosion and would connect them to Polygon’s broader DeFi (decentralized finance) network. Terra held billions of dollars in value on various DeFi applications, such as Anchor, before last week’s fall.

Inflation, bear market concerns

Crypto markets were weighed down in the past few weeks by waning sentiment for risky assets. The U.S. Federal Reserve said it would hike rates several times this year in an effort to tame inflation, which led to turbulence across broader markets.

Morgan Stanley’s wealth-management division warned against slowing economic growth in a note this week.

“The stock- and bond-market downturn has advanced to behavior resembling a classic cyclical bear market rather than simply a correction,” Lisa Shalett, chief investment officer at Morgan Stanley Wealth Management, wrote in a note on Monday.

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Shaurya is an analyst/editor for CoinDesk's markets team in Asia.

CoinDesk - Unknown

Shaurya is an analyst/editor for CoinDesk's markets team in Asia.

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