Cryptocurrencies rise after Fed rate hike

Cryptocurrencies traded higher today, fueling industrial gains added by major indexes that rose at the Fed conference yesterday. Will digital assets sustain the bullish momentum?

  • Total market capitalization remains above $1 trillion. Bitcoin climbed above $23,000, Ethereum above $1,600. Major cryptocurrencies have traditionally been followed by altcoins such as Uniswap and Bitcoincash, with gains of up to a dozen percent. The liquidation led to the liquidation of nearly $202 million in short positions;
  • Cryptocurrencies remain extremely volatile instruments. A negative publication of US GDP (-0.9% against expected 0.5%) weakened the US indices. Yesterday, the cryptocurrency market also received news of the sale of more than 1.4 million shares in the cryptocurrency exchange Coinbase by the fund ArkInvest. The fund is managed by Cathie Wood, who has an interest in blockchain technology;
  • Cryptocurrency exchange FTX has challenged Coinbase to make its shares available for trading in all US states. The FTX exchange has bought the securities settlement provider Embed Financial Technologies. The FTX token increased by 10%.

Bitcoin, which entered above $22,600, again broke above the 200 session moving average (DMA 200) on the weekly interval and defends the bullish scenario. The average has historically indicated a price floor. At the same time, we see 2 other key averages DMA 111 and DMA 200. The first average represents the short-term psychological resistance stemming from the Pi Cycle Top which is hovering around $35,000 and will act as a long-term resistance for the buyers. Source: Glass node

The CDD (Coin Days Destroyed) and MVRV (Market Value by Realized Value) indicators point to a potential undervaluation of Bitcoin. CDD aims to indicate when the Bitcoin market is completely lost and long-term investors, called hodlers, are selling. The MVRV indicator shows the price of Bitcoin relative to the average purchase price on the blockchain (realized price). Historically, levels below -1 (indicating a loss of most of the market) have indicated the formation of a bottom; in June the indicator reached record lows and indicated -1.45. Source: Glass node

Ethereum chart, W1 range. The second largest cryptocurrency is showing strength against the overall cryptocurrency market and Bitcoin. The token has been trading above its 200 session average ($1150) on the weekly interval for almost 3 weeks and continues its rally caused by the so-called “The Merge” scheduled for September 19 this year. The event will see Ethereum become up to 99.5% less energy intensive, with transactions validated in a Proof of Stake model. However, investors are most interested in the predicted “difficulty bomb” in this regard, which could freeze supply by eliminating miners. Source: xStation5

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