After a roaring weekend when BTC breached $65,000, the crypto market performance went through sudden swings this week, displaying neutral trends.
As the month comes to a close, Bitcoin may likely end it without gains. While it had breached the $65,000 mark just a week back, rising bearish pressure pulled it down. As a result, the overall crypto market performance has gone below its peak. However, the silver lining arises from Bitcoin’s movements on a broader level.
Bitcoin’s movements indicate that bulls are still active on a wider scale. Hence, BTC has not gone below $57,000 this week despite selling pressures. Moreover, the current crypto metrics are not all that bad, but just relatively not that bullish. A downtrend in the spot Bitcoin ETFs could have also influenced the crypto market this week.
September could be an interesting month not just for crypto but also for global markets of other assets. There has been intense speculation of an interest rate cut in the US. While it is not certain, the crypto market could surely benefit from some better levels of liquidity to push forward from its stagnant zone. Bitcoin has also traded between $50,000 and $70,000 for several months.
While the correlation between traditional financial markets and crypto is not direct, certain factors can influence how a rate cut affects the crypto space. A rate cut often signals a more accommodative monetary policy, which can encourage investors to take on more risk. This could lead to better demand for crypto, which is often seen as a high-risk, high-reward asset.
Moreover, lower interest rates can stimulate economic activities and increase liquidity in the financial system. Some of this liquidity can also spill over to the crypto market and benefit it. Although these are possibilities, it is still not certain the crypto market will behave this way next month.
The crypto market’s sentiments also depend heavily on technological and regulatory updates. Certain events in these two spaces can trigger sudden changes in trajectories. For example, the Bitcoin halving event was a major catalyst for the crypto market this week. The US spot crypto ETFs were another at the year’s beginning.
This week, a few of these events were in the optimistic zone for the crypto sector. The stablecoin market cap has surged to its highest-ever level, which is a great sign. Positive developments in regulations have also come in from New Zealand.
Crypto asset managers have also been very active this week, launching ETFs in Brazil and applying for derivatives approvals with regulators.
In hindsight, these crypto tokens performed the best in the last seven days:
But these tokens performed the worst:
Many factors, including global economic conditions, geopolitical events, and investor sentiment, can influence the market’s response. Additionally, the specific details of the rate cut, such as the magnitude and timing, can also play important roles in the crypto market in the next few months.
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