Daily News | Tesla Shares and Soft Economic Data Affect Crypto and Stock Markets as Bitcoin Falls and Ether Rebounds

Crypto Daily Digest: Crypto Market Sentiment Takes a Hit as Tesla Shares Fall, Bitcoin Slides Again as Ether Rebounds

Bitcoin, along with most major tokens, continued to face a decline in value over the past few days, with the O.G. coin trading at around $28,250 on Friday. On the other hand, Ether retraced upward slightly by 0.6% to around $1,950. This drop came after various factors, including a large sell order on Binance and an unexpectedly high U.K. March inflation figure, which may have soured traders’ moods. However, some analysts see this as a healthy correction that could encourage further accumulation.

The decline in Bitcoin‘s value has also affected related stocks, including Bitcoin miners and the shares of Coinbase and MicroStrategy, which fell more than 6%. Meanwhile, investors in exchange-traded funds (ETFs) tracking Bitcoin are divided on the cryptocurrency’s future, with the ProShares Short Bitcoin Strategy ETF attracting more inflows than its bullish counterpart. The $149M BITI ETF, which tracks the inverse performance of Bitcoin, has absorbed more than $118M in 2023 so far, despite a 47% drawdown.

In general, the sentiment in traditional markets was also affected by the decline in Tesla shares following the company’s earnings report released on Wednesday. While the overall crypto market performance remained down, most retail investors along with some institutional investors remain optimistic about the potential of cryptocurrencies like Bitcoin and Ether. Three firms have even filed applications to launch leveraged Bitcoin futures ETFs, indicating continued interest in the crypto market, per a Bloomberg report.

Crypto Total M.Cap $1.154T (-0.25%) - Neutral Outlook

Despite expectations, the overall value of the cryptocurrency market did not reach the previous daily supply zone of $1.3 trillion before starting to decline. This suggests that its Last Point of Support (LPS) could drop to the range of $1.1 trillion to $1.08 trillion, and even potentially reach its Major Point of Interest, or “Creek,” which is between $1.07 trillion and $1.02 trillion.

The Order book for BTC shows that there are more long-limit orders than short-limit orders, and the closest price ranges are controlled by buyers, suggesting that there will be strong opposition to any decline as buyers continue to purchase whenever possible.

Macro: Tesla Cuts Prices, Nasdaq 100 Underperforms, S&P 500 Drops Ahead of Options Expiration

Stocks fell and bonds rose after data showed some softening in the labor market, housing, and business outlook. The tech-heavy Nasdaq 100 underperformed, with Tesla signaling more price cuts, leading to a 10% decline. The S&P 500 also dropped before options expiration. The Cboe Volatility Index, or VIX, ended a six-day decline.

Fed Bank of Cleveland President Loretta Mester expressed support for another rate hike to curb inflation, while her Dallas counterpart Lorie Logan acknowledged that inflation has been too high. Recurring unemployment benefit claims increased to the highest level since November 2021, and sales of previously owned homes in March fell more than predicted. US mortgage rates increased for the first time since March.

Asian equity markets are expected to open lower due to the decline in technology stocks on Wall Street and the rise in bond yields, reflecting soft data for the labor market, housing, and business outlook. Futures for equity benchmarks in Australia, Japan, and Hong Kong indicate a lower opening.

Oil fell by the most in a month due to signs of a global economic slowdown, while gold remained steady around the $2,000 an ounce level.