The sell-off in bitcoin and ether spilled over to popular altcoins on Tuesday, with cardano, dogecoin, and litecoin all plunging.
Chinese exports and imports surged in August, assuaging fears about a slowdown and boosting stocks, as traders return from the Labor Day holiday.
The disappointing August jobs report is likely to cause the Fed to keep up its support for the economy and stocks, analysts said.
Programmers Chris and Charlie Brooks of Crypto Asset Recovery estimate between 68,110 and 92,855 seemingly lost bitcoins can be retrieved.
In focus is whether the worse-than-expected jobs report will affect the timing of the Federal Reserve's tapering of its bond-buying program.
"You say the moon is the limit. We can go up beyond that as well," Chainalysis CEO Michael Gronager told Bloomberg.
"Once initial resistance is cleared, which we expect beyond the very near term, targeted resistance would become the all-time high," Stockton said.
After a mostly quiet week for stock markets, investors turn to Jerome Powell's speech at the Jackson Hole Symposium for clues about monetary policy.
Bitcoin has fallen relatively sharply since rising past $50,000 on Monday, for the first time since May.
Solana and Ethereum logged weekly inflows while bitcoin had its seventh week of outflows, according to CoinShares.
While bitcoin has led the overall crypto market's recovery, ada is playing its part, as are rises for tokens such as solana, terra, avalanche, and fantom.
One of Lee's top five rules for bitcoin flashed earlier this month when the cryptocurrency surged above its 200-day moving average.
Two years ago, authorities confiscated 36 bitcoins from a drug dealer. Their value then is equivalent to just three bitcoins now.
US stocks were mixed on Tuesday on concerns over a slowdown in the economic recovery in light of a larger-than-expected drop in retail sales in July.
"You always buy bitcoin when it breaks above its 200-day moving average," Fundstrat's Tom Lee told CNBC on Monday.
Strong US jobs figures contributed towards tumbling gold and silver prices, but many investors remain concerned about coronavirus.
"Bitcoin is likely to clear $42,600 for a revised upside target of a secondary fibonacci retracement level near $51,000," Stockton said.
"We're inspired by the innovation happening in the cryptocurrency space and are exploring what this could look like on Amazon," a company spokesperson said.
"Importantly, both bitcoin and Ether have cleared their 50-day MAs on newly positive short-term momentum," Katie Stockton of Fairlead Strategies said.
"If you look at cryptocurrencies as a whole, it is a pure trading instrument. There is no inherent worth in it whatsoever," Luke Ellis told FT.
A report about Amazon possibly accepting bitcoin payments by the end of 2021 is seen as helping drive the digital currency's price higher.
The SEC's rejection of the Wilshire Phoenix bitcoin ETF application in February 2020 gave the fund provider insight into what's holding up the agency.
Bitcoin's valuation share of the entire cryptocurrency market peaked near 70% earlier this year and currently stands around 46%.
Technical analysts view bitcoin's $30,000 level as a make or break support level that could lead to significant downside if it doesn't hold.
So-called hyperbitcoinization could take place as early as 2035, according to Finder.com, which surveyed a panel of crypto experts.
Underpinning GlobalBlock's prediction is the Bollinger Bands indicator, which has been at its tightest spread since September 2020.
The recent rise in bitcoin mining stocks may well be a sign that big institutions are looking for a way back into the crypto arena, Fundstrat said.
Bitcoin has fallen sharply since May, but Michael Wu of Amber Group says many investors still aren't buying the dip.
Investors will be eagerly searching for clues on the Fed's approach to inflation and its plan to taper asset purchases in the FOMC minutes.
"This competition among cryptocurrencies is another risk factor that prevents them from becoming safehaven assets," Goldman said.
On May 14, the hash rate fell from 180 EH/s to its current value of 90 EH/s, according to The Block.
The S&P 500 is up 14% for 2021, the second-highest first-half gain since 1998. Chinese ride hailing giant Didi soared in its first day of trading.
JPMorgan's crypto expert said bitcoin's market share had recovered somewhat, but was not yet at the healthy 50% figure.
"We would view a breakout above the 50-day MA as a positive catalyst supporting a test of secondary resistance near $44,000," Fairlead Strategies said.
Bitcoin "rising in the face of bad news may be a sign of the seller exhaustion we need to go higher," Fundstrat said.
"I don't think people need to be anxious to be putting money in bitcoin right now," Scott Minerd said.
"Despite this week's correction we are reluctant to abandon our negative outlook for bitcoin and crypto markets more generally," JPMorgan said.
Stock market investors awaited US jobless claims and more comments from Fed officials, while the Bank of England prepared to set monetary policy.
"Cryptocurrencies total over $1 trillion of claims on real global assets while adding nothing to the GDP pool - pure dilution," Grantham said.
There is one worrying sign that the next move in bitcoin might favor more downside ahead: a bearish head and shoulders topping pattern.
Fed Chair Powell will testify before Congress on the central bank's response to the pandemic. Bitcoin slid below $30,000 for the first time since January.
Many observers have been focused on China's toughening stance on bitcoin, but the broader cryptocurrency market has not been spared.
Michael Saylor's software company bought approximately 13,005 bitcoins at an average price of $37,617 per bitcoin.
Sichuan authorities have ordered bitcoin miners to "clean up and terminate" their operations, according to media reports.
The lagging crossover indicator can help alert traders to securities that are solidifying their uptrend and are likely to experience a continuation.
The S&P 500 hit a record high for the second trading day in a row as investors awaited a key Fed decision. Bitcoin rallied above $40,000.
"People see May's volatility in many crypto assets as a buying opportunity," said the CEO of Voyager Digital about its Q2 investor survey
"Any asset class that basically moves 10% based on one guy's tweets is not fit for purpose," the investment chief at SocGen's UK private bank said.
The lesson from the 2018 bitcoin crash is that the current bear market may last months, JPMorgan strategist Nikolaos Panigirtzoglou told Insider.
Investors are eagerly awaiting for a signal from the Fed later this week about a timetable for scaling back its ultra-accommodative policy.
Cryptocurrency-focused companies jumped as an Elon Musk tweet helped lift bitcoin to its highest point in over two weeks.
Bookies say they see an implied probability of 57.9% that bitcoin spirals to $10,000 this year, which would be its lowest price since 2019.
The Basel Committee on Banking Supervision on Thursday said bitcoin's capital requirements for banks should be heavier than for holding stocks and bonds.
The price of bitcoin futures shows institutional demand for the cryptocurrency is worryingly weak, JPMorgan strategists said.
Nayim Bukele has instructed El Salvador's state-owned geothermal energy company to put up a plan to offer 100% renewable energy for bitcoin mining.
US stocks slipped at the close after nearing record highs. Bitcoin rose as El Salvador became the first country to establish the coin as legal tender.
On May 8, the number of active bitcoin addresses hit 1.229 million, just shy of the all-time record of 1.243 million, Glassnode data shows.
The broader market seems to be in a "holding pattern" as investors wait for Thursday's inflation report, said Craig Johnson, Piper Sandler chief market technician.
SkyBridge Capital's Anthony Scaramucci compared bitcoin to Amazon, whose stock price fluctuated dramatically in its early years.
"We're probably going to see the scaling out of solar because of bitcoin mining much faster now than we would have seen without this controversy," Wood said in a Tuesday webinar.
Bitcoin security concerns may be hitting investors after the DOJ recovered $2.3 million (63.7 bitcoin) of the $4.3 million Colonial Pipeline ransom.
Ether and XRP, meanwhile, logged weekly inflows in early June, according to CoinShares data.
If bitcoin is able to reclaim its 20-day moving average near $36,000, it would be a short-term bullish development, Katie Stockton said.
Once up more than 120% for the year, bitcoin's two-month slide means its 2021 returns lag behind a host of more traditional financial assets.
The number of active bitcoin addresses fell from over 1.36 million on April 15 to around just 716,000 on Sunday in a bearish sign for the cryptocurrency.
"If I were not at Square or Twitter I'd be working on bitcoin," Jack Dorsey said at the Bitcoin 2021 Miami conference on Friday.
Amundi's CIO Pascal Blanque called bitcoin a "farce" in a recent news conference and said investors should add exposure to China's renminbi.
"Bitcoin is the reserve currency of the crypto-asset ecosystem. It is the flight to safety currency," Cathie Wood said in a recent interview.
Bitcoin's scarcity amid concerns over monetary inflation has helped drive institutional interest in the asset sometimes called "digital gold."
"If [the] S&P 500 surges to all time highs, expect crypto to rise to all time highs," Fundstrat's Tom Lee said.
Stocks inched higher following strong economic data and as investors awaited more inflation figures and Joe Biden's spending plans.
The Grayscale Bitcoin Trust is the sixth largest holding of the Ark Next Generation Internet ETF, with 7.6 million shares worth about $240 million.
US stocks opened higher Wednesday. More central bank officials joined in this week to reiterate the Fed's belief that inflation will be transitory.
"With momentum in cryptocurrencies stalling, we expect some of the money to slowly flow into equities again," the research firm said in a note.
From May 17 to May 24, bitcoin holders realized net losses of $2.56 billion according to data from the blockchain analytics firm Glassnode.
At weekend lows, cryptocurrencies had lost nearly $1 trillion in market cap since May 12 amid swelling risk-off sentiment.
Stock market inflows following an equity decline have surged in 2021, suggesting that the buy the dip mentality is alive and well.
Bitcoin fell below $32,000 for the first time since January as crypto miners halted operations in China amid the country's continued crypto crackdown.
"To the extent investors are worried about medium-term inflation risks, they should probably hedge this threat using traditional securities such as gold."
"We believe that most of the leverage is out of the system now and bitcoin should start to form a base here," said Pankaj Balani of Delta Exchange.
Crypto billionaire Mike Novogratz said a boom in alternative coins was overwhelming bitcoin and the cryptocurrency market, like in 2017.
Stock markets continued to focus on the Fed, but investors kept a wary eye on the wild cryptocurrency markets.
"We were looking at all the indicators this morning, they are all suggesting that we are in the capitulation phase, which is a really great time to buy."
Michael Saylors's MicroStrategy currently holds approximately 92,079 bitcoins acquired for roughly $2.251 billion and he's not selling.
"The magnitude of [ether's] pullback shows the risk inherent to parabolic rallies, during which support levels are left well behind," Katie Stockton said.
Bitcoin is down roughly 25% since Elon Musk said Tesla would no longer accept the digital currency due to its environmental impact.
There was little enthusiasm for buying the dip in bitcoin options markets, one exchange boss said.
Three Chinese industry bodies warned investors about the speculative nature of cryptocurrencies, adding that they "are not supported by real value."
"The magnitude of [ether's] pullback shows the risk inherent to parabolic rallies, during which support levels are left well behind," Stockton said.
Billionaire crypto investor Mike Novogratz said bitcoin is likely to consolidate for four to six weeks after its Elon Musk-induced plunge.
Bitcoin has fallen 32% since Musk said Tesla would no longer accept bitcoin as a form of payment due to environmental concerns.
Bitcoin plunged to a low of $42,185 early on Monday, 35% below its record high, before rebounding after an Elon Musk tweet-storm.
It was a bad week for bitcoin, with Elon Musk criticizing its energy use and regulators increasing their scrutiny.
Bitcoin was more than 20% off its record high after Elon Musk made a major U-turn on Tesla payments, citing the cryptocurrency's "insane" energy use.
The rotation into alternatives such as ether and dogecoin is worrying for cryptocurrencies as it's "not sticky money," Pankaj Balani said.
The celebrity-driven buzz around bitcoin and other cryptocurrencies continued after Tom Brady hinted he's a fan.
The Grayscale Bitcoin Trust charges a 2% annual fee and generates $756 million in estimated revenue on its $36 billion in assets under management.
Bitcoin buyers should expect multiple 20-30% pullbacks in the bull market phase, SkyBridge's co-chief investment officer said.
Traders should look for bitcoin to move above $62,000 to affirm that the sell-off is over, according to Lee.
Bitcoin is more of a crypto commodity than currency, whereas ether is the backbone of the crypto economy and functions more as a medium of exchange.
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