The rate of bitcoin against the US dollar fell on Monday to a minimum of six weeks against the backdrop of a general risk aversion from investors due to signals of the “hawkish” mood of the Federal Reserve System (Fed).
The value of the cryptocurrency fell during trading to the lowest level since March 15, $38,223, which is 20% lower than the peak level recorded last month. As of 15:00 CST, the bitcoin rate is $38,812.
Ether (Ether) on Monday fell to $ 2799 – a minimum since March 18.
Experts note that technical analysis indicators point to the possibility of a further rollback of bitcoin.
“Bitcoin breaks a key two-month trend line, which could mean a further pullback to January lows,” said Fundstrat analyst Mark Newton, quoted by Market Watch. He expects bitcoin to drop to $36,300, and if it goes lower, he could test the $32,950 level.
Currently, bitcoin is closer to the lower end of the $35,000-45,000 price range in which it has been trading since the beginning of this year.
The dynamics of the cryptocurrency clearly correlates with the dynamics of the Nasdaq 100 index of technology companies, with a negative correlation with the dollar.
As investors wait for a substantial increase in the base interest rate by the Federal Reserve System (Fed) in the coming months, some of the factors that support the demand for cryptocurrencies are fading away.
“As it becomes more profitable to hold dollars, investors can shift funds from bitcoin or gold,” Nydig experts say. “We see a negative correlation of bitcoin’s performance with both the dollar and interest rates.”
Bitcoin’s momentum is still largely driven by fundamental factors such as user growth and the expansion of the crypto usage network, but it’s important to understand the emerging macroeconomic links as well, says Nydig.