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Why is the cryptocurrency market down today? — TradingView News
The cryptocurrency market is down today, with the total market capitalization falling 1.33% to $2.6 trillion on June 7.Cointelegraph
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Investors enter risk-on mode after better-than-expected US jobs data
The cryptocurrency market was down for a second day on June 7 as market participants reacted to stronger-than-expected U.S. jobs data, which largely beat expectations suggesting the labor market was facing politics fiscal restrictiveness better than expected.
On June 7, the U.S. Department of Labor reported the addition of 272,000 jobs in May, well above estimates of just 185,000 and significantly higher than April’s 165,000.
In May, the unemployment rate grew to 4.0% for the first time since January 2022, compared to estimates of 3.9% and 3.9% in April.
This latest reading of the jobs data has potentially pushed back the chances of the Federal Reserve cutting interest rates, a key prerequisite for an influx of liquidity into risky assets and cryptocurrencies.
The Federal Open Market Committee (FOMC) will meet on June 12 to discuss rates, with markets now seeing little prospect of a cut coming from the next two such meetings.
According to CME’s FedWatch tool, at the time of writing traders put the odds of a rate cut for June 12 at just 0.6% and for July 31 at 8.88% compared to 46% for September and 47.4% for November.
This outlook is negatively impacting risky assets such as cryptocurrencies, emerging market stocks, bonds and even commodities.
Anna Wong, Bloomberg’s chief economist, commented on the data by saying that the increase in the unemployment rate is the most important indicator of the reality of the state of employment in the country.
“We believe the latter currently offers a closer approximation to reality than payrolls, as the BLS model for estimating business births and deaths – which added 231,000 jobs to the nonfarm payrolls data at May – lags behind the reality of increasing factory closures and declining business. training. We believe the underlying pace of current job gains is likely to be less than 100,000 per month.”
Over $380 million in settlements accompany the collapse of the cryptocurrency market
The unwinding of long versus short positions in the broader cryptocurrency market has further fueled the underperformance of digital assets today.
Notably, the crypto derivatives market witnessed liquidations of over $387.83 million in the last 24 hours, including $348 million. More than $249 million in leveraged positions were liquidated in the last hour alone.
More than 133,576 traders have been liquidated in the last 24 hours with the largest single liquidation order occurring on cryptocurrency exchange OKX involving a
When long positions are liquidated, it generally results in the asset being sold (voluntarily or by the broker), which can cause the price to fall further.
Related: Bitcoin may retest $69,000 later as shorts keep BTC price below all-time high
The TOTAL market capitalization RSI is showing a bearish divergence
TOTAL market cap has been rising since May 1st and gained momentum on May 20th when anticipation and eventual approval of Ethereum spot ETFs pushed the broader cryptocurrency market higher.
The daily chart shows a bearish divergence in the RSI preceding today’s decline. The RSI is a trend-following swing momentum indicator used to evaluate whether a market is overbought, oversold, or accumulating.
A bearish divergence from the RSI occurs when an increase in price is accompanied by a decrease in momentum, resulting in a downward movement.
The bearish divergence could be a clue that the bears are in control of the market and may be planning to take the TOTAL market value towards the 100-day simple moving average (EMA) at $2.402 in the near term.
This article does not contain investment advice or recommendations. Every investing and trading move involves risk, and readers should conduct their own research before making a decision.