ethzilla

The crypto market is struggling to find stable ground after #Fed 'eral Reserve Chair Jerome Powell, speaking after the central bank cut the interest rate by 25 basis points, suggested another reduction in December isn't guaranteed.

Bitcoin (BTC) is down 2.5% over the last 24 hours to $110,200, while the broader market as measured by the CoinDesk 20 (CD20) index lost 1.7%.

While Wednesday's reduction was expected, Powell's hesitancy about further easing sparked a pullback in risk assets. The move came even as President Donald Trump signaled #trade tensions with China are easing.

The turbulence led to more than $820 million of crypto market liquidations over the last 24 hours. Equities indexes saw slight drops and #GOLD is struggling to remain above the $4,000 mark.

Still, the central bank also announced it would end its balance sheet runoff by Dec. 1, a move that could add liquidity to financial markets. To Spanish bank Bankinter, what’s stopping traditional asset prices from rising is a case of “altitude sickness.”

“The next 48 hours should be spent digesting the immense flow of information, particularly corporate earnings and central bank news,” the bank’s analysts wrote in a note. “The underlying tendency is to react quite positively, with the only constraint being the 'altitude sickness' from new highs.”

Lofty heights are not a problem for crypto given bitcoin is trading some 13% below the all-time high it hit less than a month ago. To QCP Capital, it’s a result of muted enthusiasm.

“The 10 October flash crash left both retail and institutional players cautious, and order book liquidity has yet to recover,” the firm's analysts wrote. “Meanwhile, digital asset treasuries #DAT 's are adding to sell pressure as many trade below 1 mNAV.”

These discounts could see more DATs buy back shares with funds that may come through asset sales. Ether treasury firm #ETHZilla made headlines earlier this week for doing just that, selling $40 million in ETH to repurchase shares at a discount to NAV.

Meanwhile, Friday’s $13 billion options expiry is adding more pressure to crypto prices. According to Deribit data, market makers are exposed to negative gamma at strike prices between $100,000 and $111,000.

That setup means hedging activity could amplify price swings into the end of the week. Stay alert!

Source: CoinDesk Daybook

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