Daily News | Bitcoin Drops Below $28k As US Markets Open; EX-OpenSea Employee Charged With Insider Trading

Crypto Daily Digest: Bitcoin Drops Below $28k As US Markets Open; Ray Dalio Predicts US Government Will Use Money Printers On To Fund National Deficit; EX-OpenSea Employee Charged With Insider Trading

Crypto markets experienced notable price declines across the past day, which has forced many assets in the top one hundred to shed up to 10%. As a result, Bitcoin has been forced back below the $28k threshold and Ethereum has continued to shed value and push deeper into the $1,800 zone, leading it to trade hands at an average of $1,835.17. Unfortunately, very few assets remained unscathed by this sudden onset of bearish momentum.

The volatile trading trajectory can be linked to the sudden improvement within the wider US stocks market, which can be attributed to JP Morgan’s acquirement of First Republic assets and the potential for the S&P 500 to break through its overhead resistance amidst improving analyst predictions for its upcoming performance.

Bitcoin kicked off the week with a progressive decline that led it to realize a low of $27,691.56 as the US stock markets opened and continuing the downward spiral catalyzed on Sunday as federal regulators moved to seize control of First Republic Bank. Down by almost 5% in the past 24 hours, analysts are concerned that the Federal Open Market Committee (FOMC) monetary policy meeting, which begins on Tuesday as a means of deciding whether to hike interest rates, could result in price fluctuations in the crypto market. As of now, CME’s FedWatch tool anticipates around a 94% probability of a 25 basis point increase, which would boost the target range to between 5% and 5.25%. As a result, this could lead to negative repercussions on the wider cryptocurrency market as the economy tightens.

The shaky predictions for the current US economy have been exacerbated by billionaire Ray Dalio’s predictions that the US government may resort to turning back on money printers as a means of saving the country from defaulting on its massive debt. In a recent interview broadcast on YouTube, Dalio believes that the US government will move to currency debasement to partially pay off its insurmountable $31.45 trillion national debt. According to Dalio, the Federal Reserve and its tightening monetary policies have thrust the country in a position where the government needs to introduce a fresh round of fiscal stimulus to jump-start the economy and keep the US from defaulting.

On a similar controversial note, former OpenSea employee, Nate Chastain, was charged with insider trading, however, his defense argued that Chastain was never told the NFT information under his purview was confidential, according to Reuters. Chastain was formerly a product manager for OpenSea and was in charge of which NFTs would be featured on the platform’s homepage. Chastain used his position to purchase assets that were going to be featured beforehand and then sold them when their prices rose. Chastain’s lawyers have not denied that their client conducted the trades, yet, they have persisted that Chastain was unaware that such a trade could be deemed illegal as OpenSea did not consider it to be sensitive business information at the time.

Bitcoin (BTC) $27,995.21 (-4.42%) - Neutral Outlook

(Data Courtesy of TradingView)

As of today, Bitcoin is progressively declining, falling below the support zone of $28,000 and moving deeper into the upper $27k zone. The long wick seen on April 30th shows that the bears are aggressively defending the overhead resistance at $30,000. With BTC seemingly having an aversion to this zone, paired with the bears’ current resistance, it is likely that across the coming day, Bitcoin will continue to delve deeper into the $27k zone and further away from the support zone of $28k. As a result, analysts have hypothesized that the BTC/USDT pair may swing between $26,942 and $30,000. If the price continues to plunge below the lower end of the zone, it is possible that the pair may decline to the crucial support level of $25,250. However, if the range expands above $30k, it is possible that BTC could test $31k and potentially $32,400 in the coming weeks, leading to a pick-up in momentum. Yet, the upcoming performance relies on community sentiment.

Overview:
Closest hourly support zone: 28,100-28,118
Closest hourly resistance zone: 28,095-28,101
Key Level: 0.5697 (3-Monthly High)

Hourly Resistance zones
28,138-28,126
28,100-28,118
28,095-28,101

Hourly Support zones
28,017-28,025
28,060-28,093
28,101-28,113

Macro: JPMorgan Wins Auction To Purchase First Republic Assets

As the US markets opened earlier today, it was announced that banking giant JPMorgan had won the auction to purchase First Republic assets. Senior market analyst for Oanda, Edward Moya, suggested in a public note that the fast response to First Republic’s implosion demonstrated that the banking sector was prepared to address these types of crises. Wall Street may have grown confident that wider banking risk has been “removed from the table,” Moya wrote.

Moya further stated: “It is looking like the US banking has a playbook to deal with the next banking crisis when it emerges, which is somewhat dampening the case for cryptos.” The San Francisco-based First Republic is the fourth banking institution to fail in the past two months, following suit after Silvergate, Silicon Valley, and Signature banks.

In other markets, the S&P 500 index (SPX) bounced off the 50-day simple moving average (SMA) at 4,035 on the 26th of April and reached the overhead resistance of 4,200 on May 1st. It has been anticipated that the bears are going to mount a strong defense in the zone between 4,200 and 4,325. If the price turns down from the overhead zone and does not fall below the moving averages, analysts expect that this could lead to a positive sentiment as buyers will likely be buying the dip.