Technology

Dollar Strength, Risk Aversion Sink Crypto By Investing.com


©Reuters.

By Carjuan Cruz

Investing.com – The fell 10% today, trading as low as $30,407. The crypto then trimmed losses, trading at $31,262. The digital asset is hit by the harsh economic outlook, in the face of high inflation and liquidity constraints, which are further affected by the war in Ukraine and the lockdowns in China due to Covid.

Indeed, these factors that knock down the main stock indices, and that affect the technology sector and fast-growing companies, are also affecting cryptocurrencies, whose prices are being as volatile as stocks in general.

“Cryptocurrencies are moving more and more in sync with tech stocks and are being treated as risky assets by investors, often retreating to safer corners of the market during bouts of market volatility,” he said in a report. CNN’s Michael Kamerman, CEO of trading platform Skilling.

“Bitcoin is not immune to the risk of global inflation that extends to most other asset classes. Therefore, we should expect the downward trend to continue,” the expert said.

Indeed, while interest rates continue to adjust and the Federal Reserve continues to restrict liquidity, the dollar strengthens, which goes against the premise of cryptocurrencies, in terms of a greater strength in the US currency, of importance global.

“The Fed’s drastic liquidity reversal will collapse the pandemic-era bubble in cryptocurrencies, losing-money tech companies and meme stocks,” Jay Hatfield, chief investment officer at Infrastructure Capital, added in the report. Management and manager of the InfraCap Equity Income ETF.

Source link

Related Articles

Leave a Reply

Your email address will not be published.

Back to top button