Crypto responds to the First Republic rescue

Bitcoin (BTC) took a tumble on Monday by falling 4% through the trading session in response to a rise in the US dollar.

US manufacturing PMI data came in hot, causing the dollar’s brief rally and sending the BTC/USDT pair as low as $27,670.

Then came the inevitable brokering of a deal to sell struggling U.S. regional lender First Republic North to JPMorgan Chase & Co (NYSE:JPM). in a $10.6 billion takeover.

Edward Moya, senior market analyst at Oanda, speculated that this actually promoted confidence in the traditional financial system, possibly at the expense of bitcoin, which found favor in recent times with TradFi turmoil.

“Bitcoin is struggling here as Wall Street becomes confident that banking crisis risk has been taken off the table. It looks like the US banking system has a playbook for dealing with the next banking crisis when it comes, dampening the case for cryptos somewhat,” Moya wrote in an e-mail.

Long-bitcoin liquidations hit over $50 million as a result of the decline.

A late-session pullback managed to pull the pair above 28k by the end of the day, where it has managed to stay this Tuesday morning, if only just barely.

Although it’s a bad way to start the new month, bitcoin has managed to end in the green for the past three months, a rather rare occurrence for the world’s largest cryptocurrency.

Bitcoin (BTC) takes a hit – Source: currency.com

This week could be a defining moment for bitcoin, with EU inflation data due later today, followed by the US Federal Reserve’s interest rate decision tomorrow, plus a host of other key economic data throughout the week.

Investors will be keen to get a good handle on current economic conditions before attempting either a push above 30k or a move lower.

Buyers appear willing to bid $27,500, according to the Binance order book, although any sign of indulgent hawkishness from central banks is likely to test the resolve of bitcoin bulls at this point.

Shot of ETH green

Ethereum (ETH) was slightly less affected by yesterday’s volatile trading session, falling 2% to close at US$1,830 on the ETH/USDT pair, chalking up around US$22 million in Long-ETH liquidations.

This morning we have seen a touch of green as ETH rose to US$1,835 in the Asia trading session.

Bullish support is pitched at the 1.8k price point, but as mentioned above, a hawkish surprise could definitely test the ETH bulls’ resilience.

In the altcoin space, none of the blue chips bucked the trend, with Ripple (XRP), Cardano (ADA), Polygon (MATIS), Solana (SOL) and the like tallying low to mid-single digit losses throughout the period. Monday session.

Global cryptocurrency market capitalization is currently $1.16 billion, after falling 1.5% overnight, while the total value locked in the decentralized finance (DeFi) space fell 2.5% to $47.9 billion.