Bitcoin headed for $24,000 early Wednesday, fell but then recovered and held strongly above $23,600.
The largest cryptocurrency by market cap recently traded at around $23,663, up 2.3% over the past 24 hours.
Bitcoin’s (BTC) failure to regain the $25,000 mark it crossed in mid-February and recent consolidation “could be a sign of weakness, at least in the near term,” Craig Erlam, a senior market analyst at forex market maker Oanda, wrote in a note from Wednesday.
Ether (ETH), the second largest cryptocurrency, recently rose more than 4% to last time around $1,665. The CoinDesk Market Index, which measures the performance of the crypto market, was up about 2.9% on the day.
Maker’s native decentralized finance (DeFi) token for credit and lending, MKR, has surged nearly 19% over the past 24 hours. Data from CoinGlass showed traders betting on price shifts liquidated more than $444,000 in MKR short positions over the past 24 hours. That was more than 16 times the $27,000 long MKR positions that investors liquidated over the same period. These types of short squeezes have historically tended to accelerate price jumps.
In a tweet last week, blockchain analytics firm Santiment noted the largest whale movements involving MKR in three months, with more than 24,000 of the roughly $17.4 million token “moved to a whale address” at the time and a subsequent movement were of the same size. Santiment viewed the moves as bullish.
“During downturns, massive moves like this are often correlated with turnarounds,” Santiment wrote.
Meanwhile, traditional markets performed mixed on Wednesday, as the S&P 500 and the tech-heavy Nasdaq Composite recently fell 0.4% and 0.6%, respectively. The Dow Jones Industrial Average (DJIA) rose 0.02%.
After several disappointing indicators suggesting that inflation remains a problem, investors are increasingly expecting the Federal Reserve to hike interest rates further in the coming months, despite a fourth monthly decline in Institute of Supply Management PMI data (ISM) in a row provided some evidence of an economic slowdown.
“We want prices to go up much more slowly than they are now, so disinflation has to happen for that to happen,” Steve Sosnick, chief strategist at brokerage firm Interactive Brokers, wrote in a statement Wednesday, citing Fed Chair Jerome Powell repeated use of the term “disinflation” in February.
“We should all welcome the time when disinflation becomes an enduring feature of our economy,” Sosnick continued. “But for now, the disinflation that we may have seen late last year appears to have been temporary.”
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