Bitcoin (BTC) and Ethereum (ETH) continue to see losses, with both cryptocurrencies showing bearish signs at the start of the new week. The broader cryptocurrency market is also struggling, with Bitcoin and ETH seeing drops of more than 6% in the past few days.
Other notable cryptocurrencies including Litecoin (LTC) and Dogecoin (DOGE) are also showing negative sentiment.
The consecutive release of strong economic data in the United States has increased the probability of a hawkish stance by the Federal Reserve, which is one of the main factors negatively affecting the cryptocurrency market, including Bitcoin.
In addition, the Silvergate incident compounded the market's losses. Meanwhile, Binance management has raised concerns about regulatory issues related to its partnership with Binance US.
It should be noted that Binance believes that the US authorities will treat them as a single entity, which could lead to regulatory hurdles, possibly leading to further Bitcoin losses.
Looking ahead, traders and investors are eagerly awaiting positive economic data from China, which is expected to be released this week and could help the cryptocurrency market regain its strength.
What awaits us in the next week?
Investors will be watching two key economic events later today. First, at 7:30 am, you will be closely watching the release of the monthly CPI figure for Switzerland. The market expects a rise of 0,6%, compared to 0,5% in the previous month.
Secondly, at 3pm, you will also be closely watching the release of the Canadian Ivey Purchasing Managers' Index (PMI). The previous month's reading was 60,1 and the market forecast for this month is 55,9.
On Friday, there are several key economic events to watch, including the release of Canadian and US jobs data. This includes the change in employment and the unemployment rate in CAD, as well as the average hourly earnings in USD m/m, the change in nonfarm employment and the unemployment rate.
Investors and traders closely monitor these data points as they can have a significant impact on financial markets, including currencies and stocks.
Risk sentiment in the crypto market
The global cryptocurrency market continued its downward trend over the weekend as market participants struggled to process the Silvergate situation. The value of Bitcoin has fluctuated between €22.500 and €22.600 in the last 24 hours, representing a 1% drop.
The value of Ethereum also fell 1% and is now below €1600, mimicking the behavior of BTC. If the impact of Silvergate does not spread, we could see a gradual rally in digital assets across the board.
However, the good news is that the total crypto market capitalization remains above €1 trillion, which is reassuring for cryptocurrency traders.
Additionally, Binance management has raised concerns about regulatory issues related to its partnership with Binance US, which is its US-based subsidiary.
Binance fears that US regulators will treat the two entities as one, leading to potential regulatory issues. This comes as regulatory oversight of Binance and the broader cryptocurrency industry is becoming increasingly stringent.
US dollar weakness puzzles traders
Investors awaited testimony from Federal Reserve Chairman Jerome Powell and the release of employment data in February, which could affect the hawkishness of the US central bank, leading to mixed signals for the US dollar in general.
The dollar remained in a range around 104,560, and the dollar index, which measures the currency against six major pairs, fell 0,057% to 104,560. However, the index held close to its seven-week high of 105,36, hit last week.
Slight drops in the value of the US dollar could potentially offer some relief to the cryptocurrency market by helping to cut its losses.
bitcoin price
The current price of Bitcoin is €22, with a 357,71-hour trading volume of €24. Over the past 18 hours, Bitcoin has experienced a 546% drop.
According to technical analysis, the BTC/USD pair is currently consolidating within a tight trading range of €22-€000. A violation of this range could lead to further price action in the Bitcoin market.