The Crypto Market Has Again Stepped Back on Strong Stocks

Bitcoin Retreats to Weekly Lows, Testing Market Strength

The crypto market has pulled back to the lower end of the consolidation range in place since May. The upward trend seen in the first week of the month failed to gain momentum, repeating the pattern seen in June and July when bullish attempts also faded. It appears that the theory of an inverse correlation between cryptocurrencies and the stock market has once again been confirmed, with the S&P 500 and Russell 2000 reaching new record highs.

The fact that buyers have focused on the broader market highlights a rotation away from tech stocks towards traditional sectors. Among the most actively traded cryptocurrencies, Cosmos (+10%) surged over the past 24 hours, while the majority declined, with the biggest losses recorded by Aptos (-4.7%), Bitcoin Cash (-4.5%) and NEAR Protocol (-4.4%).

Bitcoin plummeted below $63K, retreating to the lows seen at the start of last week and below the 50-day moving average. We had previously viewed the price’s ability to hold above this level as a sign of market strength. Overall, this is the prolonged consolidation around the 200-week moving average that we have repeatedly warned about. Based on historical patterns, this period of low market activity could last between 18 and 70 weeks, and we are only nine weeks in.

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The leading cryptocurrency has yet to show a confident recovery, despite the favourable macroeconomic backdrop. Sustained demand has not yet returned, but there are clear signs of seller fatigue. A break below the support zone around $63K could trigger a drop to the June low of around $58.5K, Glassnode warns.

Mining company Riot Platforms sold 4,300 BTC in the second quarter to cover operating costs and expand its data centres. Riot Platforms now holds 11,380 BTC, of which 5,821 BTC are pledged as collateral.

Metaplanet has denied selling 5,014 BTC. Contrary to rumours, the movement of bitcoins was not related to a sale, but was a reallocation of the cryptocurrency between internal wallets. The third-largest holder of Bitcoin has not sold a single coin this year. Metaplanet’s total Bitcoin reserves stand at 43,000 BTC, with an average purchase price of $102.5K per coin.

Goldman Sachs has agreed to acquire the crypto-ETF operator NEOS Investments. The deal will give the bank control over 19 exchange-traded funds linked to Bitcoin and Ethereum. The total value of ETF assets under Goldman’s management will exceed $130 billion.

The FxPro Analyst Team