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(Kitco News) - Cryptocurrency prices traded in the red on Monday ahead of a busy week of earnings reports and the Federal Reserve’s highly-anticipated interest rate announcement on Wednesday.
Stocks climbed higher as investors prepare for earnings updates from more than 150 companies in the S&P 500, with the Dow seeing its 11th-straight day of gains to lead the major indices. At the market close, the S&P, Dow, and Nasdaq were all higher, up 0.40%, 0.52%, and 0.19%, respectively.
Bitcoin (BTC) suffered its first significant drop below $30,000 since June 21, hitting a low of $28,891 near midday before dip buyers pushed it back above $29,200.
BTC/USD Chart by TradingView
The weakness for BTC was first seen in the futures markets, with August Bitcoin futures prices hitting a “four-week low in early U.S. trading Monday,” according to Kitco senior technical analyst Jim Wyckoff.
Bitcoin futures 1-day chart. Source: Kitco
“Prices are in a fledgling downtrend on the daily bar chart,” Wyckoff warned. “Bulls are fading and the bears have momentum, to suggest more downside price pressure this week.”
Prior to today’s price action, MN Trading analyst Gunter Lackmann said that the “FOMC this week could be the catalyst for a break in either direction,” and warned traders to “Beware of pre-FOMC volatility.”
“Once price starts moving, it will likely be swift, like we have seen several times since the beginning of this year,” Lackmann said. “While structurally I could see prices go as low as 26.7k if things go south, based on the PA since the end of June, a run of long stop orders towards 28.3k, then continuation towards the mid-30ks seems plausible.”
BTC/USD 1-day chart. Source: MN Trading
Lackmann added that a strong showing in the stock market that pushes indices to renew their all-time highs is a crucial element “for BTC to gather the strength to run towards 40 - 44k.”
Following Monday afternoon’s pullback for BTC, MN Trading founder Michaël van de Poppe posted the following tweet noting that the bullish case for Bitcoin can only be made once the top crypto regains support at $29,700.
Lower scenarios is the case for #Bitcoin.
— Michaël van de Poppe (@CryptoMichNL) July 24, 2023
Meaning; buy the dip season.
Breaking back above $29.7K is fireworks, but until now just waiting how LTF is going to play out. pic.twitter.com/itqaAjv7FH
Sell-off in the altcoin market
Altcoins sold off en masse, with only four tokens in the top 200 posting gains for the day.
Daily cryptocurrency market performance. Source: Coin360
Worldcoin (WLD) made its market debut by gaining 29.78% to trade at $2.16, while AMP gained 11.23%, Trust Wallet Token (TWT) climbed 8.79%, and Dogecoin (DOGE) increased 4.35%. Compound was the biggest loser with a decline of 11.77%, followed by a loss of 11.24% for Pepe (PEPE) and a decrease of 10.12% for Reserve Rights (RSR).
The overall cryptocurrency market cap now stands at $1.17 trillion, and Bitcoin’s dominance rate is 48.4%.
