Cryptocurrencies regained a foothold on Monday after a rocky start to the trade session and reflects a wider recovery in risk assets as dealers digested Moody’s downgrade of US government bonds.
Bitcoin
Notched a strong rebound after slipping to as low as $ 102,000 early in the US session after its record weekly close to $ 106,600 overnight. The largest cryptocurrency of market capital rose back to $ 105,000 in the afternoon trade, an increase of 0.4% over 24 hours. Ether rose 1.2%and regain the $ 2,500 level.
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Most large Cap Altcoins overcame, while most of the BredmarkedCoindesk 20 index members still remained in the red despite leaving their daily life. Solana, Avalanche and Polkadot fell 2%-3%.
Bounce also expanded to US shares where the S&P 500 and NASDAQ erase their breakfast fall.
The early withdrawal in crypto and the stocks came after Moody’s late Friday downgraded the US credit rating from his AAA status. The move rattled the bond markets and pushed the 30-year-old treasury over 5% and the 10-year-old note to over 4.5%.
Still neglected some analysts downgrade’s long -term influence on asset prices.
“What does it do [the downgrade] mean to markets? Prolonged nothing, “said Ram Ahluwalia, CEO of Wealth Management Firma Lumida Wealth. He added that in the short term there could be some sales pressures centered on US Treasury due to large institutional investors rebalancing, as some of them are injured to have acts only in AAA classifications.
“Moody’s is the last of the three major rating agencies to downgrade US debt. This was the opposite of a surprise – it was a long time to come,” said Callie Cox, Chief Market strategist at Ritholtz Wealth Management, in an x post. “That’s why stock investors don’t seem to care.”
Bitcoin is targeted at $ 138,000 this year
While BTC is hovering just below its record prices in January, Digital Asset ETF is seeing the 21Shares more upside for this year.
“Bitcoin is on the brink of a breakout,” research strategist Matt Matt Mena wrote in a Monday report. He argued that BTC’s current rally is not driven by retail mania, but by a collapse of structural forces, including institutional influxes, a historical supply crushing and improving macro conditions suggesting a more durable and mature path to fresh all-time highs.
Spot Bitcoin ETFs have consistently absorbed more BTC than has been extracted daily, and tight supply, while larger institutions, companies such as strategy and newcomers Twenty One Capital accumulate and even states explore to create strategic reserves.
These factors combined could lift BTC to $ 138,500 this year, Mena predicted that it translated into an approx. 35% rally for the largest crypto.
