BTC Price Stalls at $84K Ahead of FOMC Meeting, Analyst Warns of Another Leg Lower

Crypto markets climbed greater on Monday with bitcoin (BTC) buying and selling above $84,000 as one other constructive day for U.S. shares prolonged their rise lifting danger belongings.The largest cryptocurrency was up, the broader crypto market was up 1.8%, whereas the broad-market CoinDesk 20 Index barely outperformed with a 2.4% advance throughout the identical interval. Ethereum’s ether (ETH) stabilized above $1,900 and was 2.8% greater, whereas a number of altcoin majors together with SUI, AAVE, ICP and NEAR booked greater than 5%.

Solana additionally edged 3% greater consistent with the broader market, as the primary day of SOL futures buying and selling on institutional-focused market CME did not make a distinction on investor sentiment.

Ethena’s governance token (ENA) rallied 7% on the information of creating a proprietary blockchain with tokenized asset issuer Securitize, aiming to attach decentralized finance (DeFi) and conventional establishments.

Key U.S. inventory indexes extending their bounce into this week gave a positive backdrop for danger belongings. However, LMAX Group strategist Joel Kruger warned that the month-to-month S&P500 chart suggests a sustained correction for U.S. equities, which might weigh on cryptocurrencies.

“When we consider the state of global trade tension and concerns around a slowdown in the US economy, all at a time when it’s increasingly uncertain how much more accommodation the Fed can offer, there is indeed worry stocks could fall further,” Kruger mentioned.

He famous there is a potential for a decrease low for BTC to revisit the 2024 March peak at $73,000-$74,000.

The market near-universally expects the Fed to maintain charges unchanged throughout this week’s Federal Open Market Committee’s assembly, however buyers ought to keep watch over any potential change within the central financial institution’s steadiness sheet runoff, or quantitative tightening (QT) program, mentioned David Duong, head of analysis at Coinbase Institutional.

“We think the Fed might pause or end its QT program this week, as bank reserve levels are near the 10-11% of GDP levels that are commonly considered sufficient for maintaining financial stability,” he wrote in a Monday report.

He mentioned the current crypto selloff was largely resulting from macro considerations and deteriorating liquidity circumstances, which might flip for the higher throughout the subsequent quarter, offering tailwind for asset costs. “Crypto prices could find their bottom in the next few weeks before rebounding to new highs later this year,” he concluded.