Bitcoin and Cryptocurrencies Show Little Change Amid Trading Lull

by Warren Seah

Bitcoin and other cryptocurrencies experienced a relatively quiet day on Tuesday as digital assets appeared to settle into a trading lull. While the previous period of slow movement lasted for three months, traders anticipate that volatility will return sooner this time.

Over the past 24 hours, the price of Bitcoin has remained near $25,950, showing minimal fluctuations. It has consistently lingered around the $26,000 level for the past two weeks following a sell-off from its peak of $29,000.

This narrow range has become characteristic of Bitcoin, as it has been constrained within the vicinity of $26,000 for the past eleven days. Typically, such periods of calm are followed by a surge in volatility. Analyst Alex Kuptsikevich from broker FxPro suggests that we may witness such a boom in the coming week.

After enduring one of the longest periods of low volatility on record, during which it mainly fluctuated between $29,000 and $30,000 for nearly three months, Bitcoin recently experienced a decline to mid-June lows on August 17th. Now, despite significant fluctuations in the stock market—often linked to crypto chaos—Bitcoin remains stagnant around $26,000.

As volatility grips the Dow Jones Industrial Average and the S&P 500 in recent days, Bitcoin finds itself in another lull. Traders eagerly await signs of renewed activity in the crypto market.

The Volatility of Cryptocurrencies Continues Amid Macro Catalysts

Kuptsikevich and others are predicting that the current period of stability in the cryptocurrency market won’t last, particularly with influential macro catalysts on the horizon. One such catalyst is the highly anticipated U.S. jobs report, scheduled for release on Friday. This report will significantly shape the Federal Reserve’s future monetary policy decisions, making it a crucial factor for risk-sensitive assets like stocks and cryptocurrencies.

Bitcoin’s Woes Persist as Catalysts Approach

Despite the previous selloff in August, Bitcoin has struggled to regain momentum. Coupled with the impending catalysts, the risks appear to be tilted towards further declines.

Katie Stockton, managing partner at technical research firm Fairlead Strategies, remarks, “Short-term oversold conditions have proved insufficient to generate a meaningful bounce. Given the weak intermediate-term momentum, there is a heightened probability of a breakdown below the initial support level of $25,200.”

Ether and Altcoins Show Limited Growth

Beyond Bitcoin, Ether, the second-largest cryptocurrency, has seen a minimal increase of less than 1% and is currently hovering around $1,650. Conversely, smaller tokens, specifically altcoins, have experienced some gains. Cardano and Polygon have both risen by more than 1%. Meanwhile, the performance of meme-based coins has been mixed, with Dogecoin showing a meager increase of under 1% while Shiba Inu has surged by 3%.

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