Leading cryptocurrencies tanked on Wednesday after the Federal Reserve’s hawkish meeting minutes drove Treasury yields higher.
Crypto Market in Red
Bitcoin sank below $83,000, while Ethereum lost its $2,600 support amid broader cryptocurrency sell-offs.
Cryptocurrency-related stocks also fell, with Strategy Inc. (NASDAQ:MSTR) and Bitmine Immersion Technologies Inc. (NYSE:BMNR) closing down 6.79% and 5.90%, respectively.
Cryptocurrency liquidations surged over $700 million over the last 24 hours, with $646 million in bullish long positions alone wiped out, according to Coinglass data.
Bitcoin’s open interest dipped 1.60% over the last 24 hours. Binance derivatives traders, including both retail and whales, increased their long exposure to the apex cryptocurrency.
Top Gainers (24 Hours)
Stocks Correct After Fed Signals Hawkish Outlook
Stocks descended from record highs on Wednesday. The Dow Jones Industrial Average retreated 341.41 points, or 0.66%, to close at 51,179.87. The S&P 500 slipped 0.22% to end at 7,801.77. The tech-focused Nasdaq Composite fell 1.32% to end at 27,538.69.
Minutes of the September meeting showed the Fed united on raising rates and leaning toward another hike by year-end. Traders currently assign only an 18% probability to a rate hike at the central bank’s October meeting, but more than a 66% probability to a hike at the December meeting, according to the CME FedWatch tool.
The 10-year Treasury yield rose to 5.36%, its highest since April 2002. Returns on the 30-year Treasury notes jumped to 5.73%.
Bitcoin Bulls to Return?
Ali Martinez, a widely followed cryptocurrency analyst and trader, noticed a “Buy Signal” on Bitcoin’s hourly chart at the $83,000 support level using the TD Sequential indicator.
“The correction over the past 24 hours was preceded by a sell signal from the same indicator,” Martinez said. “Now, with the TD Sequential flipping bullish at support, I’m watching closely for a potential BTC rebound.”
The TD Sequential indicator is a technical analysis tool that helps traders identify potential price reversals and exhaustion patterns.
Michaël van de Poppe, another popular cryptocurrency commentator, predicted a “larger form” of Bitcoin correction involving a downside sweep of long-side liquidity followed by a reversal.
Phenomenal entry opportunity,” he added.
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