• Bitcoin slips after failing to claim the 70,000 psychological mark

• Probably due to profit taking as markets clip odds of a Trump win

• Crypto correlation with stocks remains relatively low

 

Bitcoin under pressure

Bitcoin has been on a slippery slope this week after touching the $70,000 psychological mark, on Monday, for the first time since June 7. Much of this weakness is attributed to the risk off sentiment observed in markets, but it is certainly more than that.

In contrast to stocks, cryptocurrencies failed to rally in the aftermath of the FOMC meeting on Wednesday, in which the Fed hinted at a September cut. A possible explanation is that bullish sentiment around Bitcoin has been slowly fraying as Trump's lead in the Presidential election narrows.

The divergence of cryptos and equities has become a theme lately, with Bitcoin’s one-month correlation with Nasdaq 100 currently standing at 0.1598. This number is relatively low considering that cryptos are often quoted as stocks on steroids.

Ether ETFs launch fails to boost sentiment

Things are not looking great for the second-largest cryptocurrency by market capitalisation. Ethereum just notched a two-month losing streak, its first since July-August of 2023. Interestingly, the highly anticipated launch of spot-Ether ETFs in the US was not enough to rescue the price, even though it was expected to be a fresh growth lever in the broader crypto space.

From a technical standpoint, ETHUSD has been battling with the 200-day simple moving average (SMA) in the past few sessions, where a decisive break below this hurdle could alter the technical outlook to bearish. If that happens, sellers might attack the recent support of $3,075, which also held strong in March. Alternatively, should the price bounce higher, the recent resistance of $3,400 could prove to be the first obstacle for the price to clear.

BTCUSD extends decline from 1-month high

BTCUSD (Bitcoin) had a very strong July, with the price reaching the $70,000 psychological mark for the first time in more than a month. Since then, it has been experiencing a downside correction, with the 50-day SMA acting as a strong floor for now.

Should selling pressures persist and the price fall below its 50-day SMA, the recent support of $62,170 could act as the first line of defence. Further declines could then cease around the May support of $60,150.

On the flipside, if the bulls attempt to erase the latest setback, the April resistance of $67,270 could curb initial advances. Piercing though that zone, the price could revisit its recent one-month peak of $70,015.