Bitcoin, Ether dip; Dogecoin loses Twitter tailwind; US stocks fall on recession worries
Bitcoin fell below US$28,000 in Thursday morning trading in Asia as most of the other top 10 non-stablecoin cryptocurrencies lost momentum. Ethereum edged lower but held a weekly gain of over 5% as the blockchain’s Shanghai upgrade nears. Dogecoin led the losers after a Tuesday rally sparked by Elon Musk changing his Twitter icon to a Shiba Inu dog. US stocks traded mixed on Wednesday as data showed a slowdown in the labor market and services, raising concerns among investors about a potential recession ahead.
Bitcoin fell 2.47% to US$27,983 in the 24 hours to 9:00 a.m. in Hong Kong, down 1.34% for the week, according to CoinMarketCap data.
The world’s largest cryptocurrency has been hovering around the USD 28,000 resistance level since late March. MicroStrategy, a US-based business intelligence firm and the world’s largest corporate Bitcoin holder, said it bought 1,045 Bitcoins for about US$29.3 million between March 24 and April 4, 2023, which could help investor sentiment.
Ethereum fell 1.03% to US$1896, but is up 6.04% for the week. The token hit a high of $1,937.50 on Wednesday to trade above $1,900 for the first time since August 2022. The Shanghai hard fork of the Ethereum blockchain, also known as the Shapella upgrade, is coming next Wednesday, allowing investors to withdraw s bet ETH for the first time.
Dogecoin led the losers, falling 4.66% to $0.09127, but still posted a weekly jump of 21.60%. Investors can take profits from the token’s rise earlier this week when Elon Musk on Monday changed the blue bird icon on its Twitter site to a Shiba Inu Japanese dog, the same image used by the meme coin. Musk has yet to say why he did it, other than to tweet out a meme.
The total crypto market cap fell 0.95% in the last 24 hours to $1.19 trillion. Total trading volume in the same period increased by 0.14% to $43.08 billion.
In the non-fungible token (NFT) market, the Forkast 500 NFT index was down 0.12% at 4,029.45 in the 24 hours to 09:00 in Hong Kong, but was up 0.61% for the week. The index is a proxy measure of the performance of the global NFT market and includes 500 eligible smart contracts on a given day. It is administered by Discard Labs data branch, CryptoSlam.
NFT sales on the Ethereum blockchain rose 17.81% in the 24 hours to 09:30 in Hong Kong. This can be attributed to volume on OpenSea Pro, an NFT marketplace developed by OpenSea that targets experienced investors and offers zero listing fees for a limited period, said Yehudah Petscher, NFT strategist at Cryptoslam.
US stocks closed mixed on Monday. The Dow Jones Industrial Average added 0.24%, the S&P 500 fell 0.25% and the Nasdaq Composite Index fell 1.07% as investors analyzed weak economic readings on Wednesday.
The U.S. private sector saw a decline in employment, with 145,000 new jobs added in March, compared with an expected 210,000, and down from 261,000 in February. Annual wages rose 6.9% from a year earlier, down from 7.2% last month, according to Automatic Data Processing Inc. The slowdown in job growth and wages was linked to weak consumer demand and rising borrowing costs.
Another bearish indicator for the US economy released on Wednesday was the services purchasing managers’ index (PMI) for March which came in at 51.2%, according to the Institute for Supply Management, also well below expectations of 54.5%. The index is a measure of market conditions, with a lower reading indicating a shrinking economy.
Despite those signals, Federal Reserve Bank of Cleveland President Loretta Mester said Wednesday that interest rates may need to rise and “hold there for some time to ensure that inflation is on the sustainable downward path to 2%,” according to a Bloomberg report.
Inflation as measured by the US consumer price index rose 6% from a year earlier in February, down from 6.4% the previous month, but still well short of the Federal Reserve’s goal of keeping annual inflation below 2%.
US interest rates are now between 4.75% and 5%, the highest since June 2006. Ahead of the Federal Reserve meeting on May 3 to make its next move on interest rates, analysts at CME Group expect a 54.2% chance of no interest. increase, while 45.8% expect a rise of 25 basis points, up from 41.1% on Wednesday.
US stock futures were trading lower as of 9:00 a.m. in Hong Kong. Dow Jones Industrial Average futures fell 0.10%, S&P 500 futures fell 0.17% and the Nasdaq Composite Index fell 0.31%. Investors are awaiting several data releases this week on the US labor market, including the Labor Department’s first jobless claims on Thursday and a summary of the US jobs situation on Friday.
