The violent ups and downs of the current crypto market can leave some investors more than a little queasy, but it can be worth it in the long run.
A period of stormy seas
Choppy seas is the name of the game for crypto as bitcoin and the altcoins seek to lay the firm foundations for the next crypto bull market. Calm seas will see the price slowly going sideways and upwards, whilst the storms will come in frequently to drive the price back down again.
This is the game that is played and everyone knows how it goes. However, the ultimate destination for the crypto ship is not yet known. A hostile SEC in the U.S. is doing its best to dampen down the optimism caused by the massive tide of innovation brought to markets by crypto.
The recent shutting down of staking on the Kraken exchange gives more than a subtle hint of where the SEC has positioned itself. All the more so given that one of its commissioners, Hester Peirce, was even roused to publish a public statement of dissent on the SEC’s own website.
However, the actions of Gensler’s SEC have done the job, and right now crypto is mired in a sea of uncertainty. Bitcoin is once more sitting at the midpoint of the range between $25,000 and $17,600. Should it break through to the downside, $20,800 is the next area of support.
Inflation print could decide next move
Also, if bitcoin loses support then altcoins will certainly crash a lot harder. Nevertheless, it must be acknowledged that the altcoins have continually risen in value since the beginning of this year. A correction was surely due, and the current market cap of altcoins at $351 billion, down from a $390 billion high, may be considered a decent retrace.
U.S. CPI data is out on Tuesday, and so before and after this there is likely to be a lot of market volatility. Should we see a return to higher than expected inflation then batten down the hatches at least into the short term.
On the other side of the coin, should inflation print yet another lower percentage then expect more balmy seas, and for bitcoin and the altcoins to rise accordingly.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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