Crypto Values Set For Next Leg Down says FxPro

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According to Alex Kuptsikevich, senior market analyst at FxPro, cryptocurrency values might be poised for a potential downward movement.

Kuptsikevich highlights various factors, including recent price fluctuations, market trends, and regulatory developments, that suggest a potential decline in crypto values.

"The crypto market capitalization rose 1.5% last week to reach $1.066 trillion at the start of the new week," notes Kuptsikevich.

However, despite this overall increase, specific cryptocurrencies experienced mixed performance.

Bitcoin, for instance, gained 2% before ending the week down 4% at around $26,500.

Ethereum also lost 1%, settling at $1,730. Other leading altcoins, such as TRON and XRP, witnessed declines ranging from 0.4% to 6.4%. In contrast, BNB saw a slight increase of 2.6%.

Analysing Bitcoin's market behaviour, Kuptsikevich states, "Thanks largely to positive equity market traction, bitcoin found support on the downside below $25,000 and formally closed above its 200-week average."

However, he adds a note of caution, pointing out that the overbought equity market and looming downside risks could push BTCUSD lower, potentially prolonging the bearish trend.

Kuptsikevich suggests that a rally above $27.2K, accompanied by surpassing previous local highs and the 50-day moving average, would be required to effectively break this trend.

In light of recent market developments, Kuptsikevich references Bloomberg's findings, stating that "Bitcoin's share of the total market value of all cryptocurrencies has reached its highest level since mid-autumn 2021."

This observation indicates that traders are more inclined to allocate their funds towards Bitcoin rather than altcoins, potentially impacting the overall performance of the crypto market.

Kuptsikevich also highlights significant regulatory and investment news within the crypto space.

Digital asset platform Bakkt has temporarily removed Solana, Polygon, and Cardano cryptocurrencies from its available assets due to regulatory uncertainties.

On the investment front, major US financial institutions, including BlackRock, Bank of America, and Fidelity, are increasing their investments in MicroStrategy shares, with over $200 million invested.

Notably, MicroStrategy holds a substantial amount of Bitcoin, owning more than 140,000 BTCs.

Additionally, regulatory scrutiny on cryptocurrency exchanges is intensifying. The Securities and Exchange Commission (SEC) has agreed with Binance to restrict employees of the parent platform from accessing the assets of Binance.US customers.

Furthermore, French authorities have opened an investigation into Binance, citing suspected money laundering, failure to comply with KYC procedures, and other potential violations of French law, as reported by Le Monde.

As the crypto market faces potential downward pressure, influenced by market dynamics, regulatory developments, and shifting investor preferences, traders and investors will closely monitor these factors to make informed decisions. Kuptsikevich's analysis highlights the need for caution and ongoing vigilance in the volatile crypto landscape.