Bitcoin, Ethereum Flat, Dogecoin Among Top Gainers: Why This Analyst Says Tesla's Apex Coin Sale Implies Crypto Bottom Is Close

Zinger Key Points
  • Macroeconomic headwinds blow against BTC, but “peak pessimism” close to getting priced in - OANDA analyst
  • Tesla says it sold off 75% of its Bitcoin holdings and netted $963M from the sale
  • Markets looking "top-heavy," according to cryptocurrency trader Justin Bennett

Bitcoin and Ethereum traded flat but Dogecoin spiked as the global cryptocurrency market cap fell 0.9% to $1 trillion at press time.

Price Performance Of Major Coins
Coin 24-hour 7-day Price
Bitcoin BTC/USD 0.07% 15% $23,314.57
Ethereum ETH/USD -0.12% 37.4% $1,529.80
Dogecoin DOGE/USD 2.6% 13.5% $0.07
Top 24-Hour Gainers (Data via CoinMarketCap)
Cryptocurrency 24-Hour % Change (+/-) Price
Lido DAO (LDO) +5.75% $1.59
Monero (XMR) +2.9% $151.44
Dogecoin (DOGE) +2.6% ​​$0.07

See Also: Best Crypto Debit Cards

Why It Matters: The two major coins exhibited weakness Wednesday evening along with stocks, which closed higher intraday but lost steam in the after-hours session.

The S&P 500 and Nasdaq futures were down 0.3% each at press time as investors digested a slew of earnings. For the day, the S&P 500 closed 0.6% higher, while the tech-heavy Nasdaq shot up 1.6%.

Macroeconomic headwinds continue to blow against Bitcoin, but “peak pessimism” is close to getting priced in, said OANDA senior market analyst Edward Moya.

“The risks remain elevated but now Bitcoin is at the $24,000 level and selling pressure seems to be throwing in the towel for now,” said Moya on Tuesday in a note, seen by Benzinga.

In an earnings release, Elon Musk-led automaker Tesla Inc TSLA said it had sold off 75% of its Bitcoin holdings and netted $963 million from the sale. Last year it purchased $1.5 billion of the apex coin.

Michaël van de Poppe said on Twitter that Tesla’s sale was one of the contributors to the recent Bitcoin crash. He said this is also “why we’re close to the bottom.” 

In a separate tweet, the cryptocurrency trader noted that without earnings from Bitcoin, Tesla’s cash flow was “probably going to be negative.”

Fellow trader Justin Bennett warned investors that markets are looking a “little top-heavy.” He said, “Maybe a flush of late longs here. Be careful.”

Chartist Ali Martinez said that the Tom Demark (TD) Sequential, a tool that can help discover the exact time of trend exhaustion and price reversal, indicates a “sell signal” on Bitcoin on its four-hour chart.

“A sustained four-hour candlestick close below $23,600 can trigger a correction for [BTC] to $22,500 or even $21,670.”

Meanwhile, profit-booking has been more robust in Ethereum than in Bitcoin as the two assets diverged recently. Ethereum has seen far more signs of profit taking. The ratio between transactions in profit vs. loss paints two very different pictures for the top market cap assets in [cryptocurrencies],” tweeted Santiment, a market intelligence platform.

Read Next: Michael Saylor Comments On Tesla's Bitcoin Sale: How Much Did Tesla Really Sell?

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