Bitcoin and Ethereum fail to recover ahead of an unforgiving Fed
The cryptocurrency market maintains its depressed look on Wednesday with investors elevating caution, especially in risk assets, ahead of the US Federal Reserve (Fed) conclave. Another inflation-fighting rate hike is expected, and some observers believe it could be as much as 1%, resulting in moderate declines for Bitcoin and Ethereum, as they fail to expand their Tuesday rebound.
Last session, the queen of digital assets rebounded from its weekend plunge, which extended to September 19, when it hit a three-month low near $18,000. Despite the rebound, it is again trading below $19,000 and "its technical aspect is very complicated and it seems very likely that we could end up seeing a new attack on the level of $17,640," stated César Nuez, an analyst at 'Bolsamanía'.
"The abandonment of this price level would be a cataclysm for its technical aspect, and that could bring an extension of the falls to the vicinity of $12,200," he warned. "Taking an interest in crypto right now does not seem like a good idea, and we will not see a sign of strength as long as it continues to trade below $22,700, the September high," Nuez added.
As for Ethereum, the sell-off has been baiting the token following the rollout of 'The Merge,' the eponymous blockchain's migration to the proof-of-stake consensus model. The 'sell the news' move exacerbated the sell-off after Ether had been gaining traction the past few months in anticipation of this moment and the digital asset even corrected 20%.
For the time being, however, it has managed to hold in the vicinity of its support at $1,270. Despite everything, "its technical aspect is complicated and we do not rule out an extension of the falls, since its main trend is clearly bearish and for weeks it has been making declining highs," commented Nuez. He also warned that "an extension of the falls to the annual lows reached in June at $876 is very likely".
The rest of the market follows the same pattern as the main tokens and the total capitalization remains around $930,000.
In other crypto-related news, purchases by Microstrategy stand out, as it acquired 301 Bitcoins at an average price of $19,851 in the bear market, showing that Michael Saylor's company is redoubling its confidence in the cryptoasset market.
There is also talk in the market that Nasdaq Digital Assets will offer custody services for cryptocurrencies, including Bitcoin and Ethereum.