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The vast majority of retail client accounts lose money when trading CFDs.
Important Notice - Fraud awareness
Important Notice - Scam alert
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail client accounts lose money when trading CFDs. You should consider whether you can afford to take the high risk of losing your money.
Important Notice - Fraud awareness
Important Notice - Scam alert
The vast majority of retail investor accounts lose money when trading CFDs / Spread betting with this provider.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail investor accounts lose money when trading CFDs / Spread betting with this provider. You should consider whether you understand how CFDs / Spread betting work and whether you can afford to take the high risk of losing your money.
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Bitcoin (BTCUSD) under pressure as it approaches July lows

Bitcoin prices under pressure once again as the crypto leader tested the July lows of $19,000.

Daily BTCUSD Chart

A rally in the coin ran to the $25,000 level in mid-August but has fizzled out to trade again at the lows of early July. Bitcoin is following the commodity sector lower as an alternative, and pro-growth investments continue to suffer under the weight of central bank rate hikes.

The Bank of Canada went ahead with a 75bps rate increase on Wednesday, and the European Central Bank is set to follow on Thursday with expectations of a similar move.

These interest rate moves make safe haven investments such as bonds more appealing. Bitcoin has also suffered in the near term as Ethereum has grabbed investor attention ahead of its merge update.

The general cryptocurrency market is being dragged lower by ongoing strength in the US dollar. The greenback hit a 24-year high against the Japanese yen and set an all-time high against the Indian rupee. That weighed down stock markets, and the tightening of credit means that the tap has been turned off, where the easy money was invested into rising stocks. Profits from that trickled down to crypto markets, and we are now in reverse.

At the moment, it would be dangerous to catch a falling knife, and Bitcoin investors should be leaning toward the short end. A smaller ECB rate hike tomorrow could help BTC, but that would also boost the dollar. Tomorrow’s ECB meeting and the resulting press conference comments will also be important for the crypto space.

The worry for BTC going lower is that futures trading has reached an all-time high of 565,579 BTC ($10.6 billion) in open interest, above the February peak of 548,096 BTC, according to Arcane Research. Any further selling could see further liquidation and a lower spike in the cryptocurrency market.

Last Updated: 08/09/2022

This market commentary and analysis has been prepared for ATFX by a third party for general information purposes only. Any view expressed does not constitute a personal recommendation or solicitation to buy or sell as it does not take into account your personal circumstances or objectives, and should therefore not be interpreted as financial, investment or other advice, or relied upon as such. You should therefore seek independent advice before making any investment decisions. This information has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. We aim to establish and maintain and operate effective organisational and administrative arrangements with a view to taking all reasonable steps to prevent conflicts of interest from constituting or giving rise to a material risk of damage to the interests of our clients. The market data is derived from independent sources believed to be reliable, however we make no representation or warranty of its accuracy or completeness, and accept no responsibility for any consequence of its use by recipients. Reproduction of this information, in whole or in part, is not permitted.


 

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