Bitcoin and Ether Up 3% as Traders Capitalize on Lower Prices
Bitcoin and Ether rebounded modestly on Tuesday after a sharp decline triggered by broader market jitters.
Bitcoin rose 3%, trading at about $55,609 as of 4:30 UTC, but is down 17% over the past week. Similarly, Ether gained 3%, reaching $2,494, though it has fallen 25% in the last week.
Analysts believe the recent price uptick signals that investors are taking advantage of the recent market downturn to purchase cryptocurrencies at lower prices. However, overall market sentiment remains wary as there are concerns that this could be the beginning of a more extensive liquidation of crypto holdings.
The recent downturn in cryptocurrencies, including significant losses in the last 24 hours, accompanies a broader sell-off of risk assets over the past three days. According to Coinglass data, this resulted in about $1.1b in liquidations on Monday, marking one of the highest levels of liquidations since early March this year.
The shift began when the Bank of Japan implemented a 25 basis point rate hike, its largest since 2008, just a few months after moving interest rates out of negative territory. This significant adjustment led to a substantial unwinding of the Yen carry trade, affecting global liquidity.
Despite suffering its largest single-day loss since the 1987 Black Monday crash the previous day, Japan’s Nikkei 225 and Topix indices rebounded sharply, gaining over 10% on Tuesday.
Expectations for a significant interest rate cut by the Federal Reserve in September doubled, sending shockwaves through the stock market. Fears of a potential US recession, or “hard landing,” intensified, driving down major indices.
“Global equity markets are selling off, bond yields are plummeting, and as a result, we’ve seen large outflows in the
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