Poodlana Token Sale Thrives as Cryptocurrencies Shed Billions of Dollars

Cryptocurrencies have shed billions of dollars in the past few days as investors remain concerned about Japan, US election, and technical formations.

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Bitcoin dropped to $49,660 at the time of writing. This price represents a decline of more than 4% from last Friday’s highs of about $52,000. Other coins have also plunged, with some like BNB, Solana, and XRP falling by double-digits.

Among the top cryptocurrencies, Bitcoin Cash is the only one that is trading higher on the day. It rose by about 2%, bringing its gains from last week’s lows to more than 10%.

Cryptocurrency prices have been under pressure in the past few days as investors remain concerned about several things. Among them are fears of a recession, the US election, technical formations, and news from Japan.

Jobs numbers and crypto

One of the biggest concerns among investors are the ongoing fears of a recession. Last Friday, the government published relatively weak jobs numbers for the month of July. The data showed that the unemployment rate rose to 4.3% from the prior month’s 4.1%.

This increase happened even as economists were expecting the rate to drop to 4.2%. Further, the numbers showed that the economy created just 114k jobs last month. This figure was substantially lower than the median estimate of 175k positions.

The weak jobs numbers are important for several reasons. First, they poured cold water on the recent optimism that the Federal Reserve will start pivoting on its aggressive interest rate hikes.

Second, the weak numbers are a sign that the economy is slowing down substantially. As a result, there are concerns that the country will slip into a recession in the coming months.

This slowdown is already evident in several sectors of the economy. For example, the housing market has started cooling down substantially while manufacturing activity has also slowed down.

Crypto prices have tended to react sharply to changes in the jobs numbers. This time, however, the prices have reacted calmly to the weak numbers. Bitcoin dropped by just $1,000 while other coins like Ethereum fell by double-digits.

Other concerns

In addition to the jobs numbers, there are other concerns that are affecting cryptocurrency prices. One, there are worries about the Bank of Japan (BOJ). Last week, the bank surprised investors by announcing that it will start hiking interest rates.

This decision is important considering that Japan is the third-biggest economy in the world and one of the largest buyers of foreign assets. Further, the hike came at a time when other central banks, like the Federal Reserve, are cutting rates.

Two, there are concerns that Donald Trump will not win the presidential election after all. Most cryptocurrency investors believe that Trump would be a better president for the industry. For one, he has vowed to fire Gary Gensler, the SEC chair, on day one.

Three, there are technical concerns about Bitcoin and other coins. As shown in the chart below, Bitcoin formed a bearish “death cross” pattern last week. This pattern is formed when the 50-day moving average (MVA) crosses the 200-day MVA from above.

Historically, this pattern has been bearish for Bitcoin and other assets. Still, there have been times when the pattern has failed to predict future performance. For example, in 2021, the pattern formed twice but BTC prices surged to a record high of $70,000.

Still, there are other times when the pattern has worked. For example, in 2022, the pattern formed in March and Bitcoin prices crashed by more than 50% from those levels. Now, it remains to be seen what will happen next.

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