• Bitcoin drops to its lowest level since May 15

• Cryptos’correlation with equities has weakened lately

• On Thursday,spot Bitcoin ETF debuted in Australia

 

Bitcoin slides below $65,000

Cryptocurrencies have come under selling pressure in the past month, with Bitcoin dropping to a fresh one-month bottom on Friday. The prospect of interest rates remaining higher for longer after the Fed’s latest dot-plot indicated one rate cut for the year has applied upward pressure both on the US dollar.

In theory, such a development would be negative for all risk-sensitive assets, but lately cryptos and stocks have not been reacting in the same manner. More specifically, digital coins have been losing ground in a period when the US stock market is rallying to consecutive higher highs.

This phenomenon could be attributed to the fact that market participants could be clipping their exposure to riskier assets first in anticipation of higher interest rates moving forward. Moreover, US stocks may have attracted some inflows from risk-seeking investors who wanted to diversify away from European equities amid a period of political uncertainty in the region.

Meanwhile, during the past month, Ethereum has largely outperformed Bitcoin on the back of the approval of spot Ether ETFs by the SEC. However, traders should not get overexcited as the second-largest cryptocurrency by market cap could experience a sell-the-fact type of reaction after the eventual launch of such investment vehicles.

Bitcoin ETFs debut in Australia

As important upgrades like Bitcoin halving or Ethereum’s Dencun are now behind us and ETF excitement in the US has been slowly ebbing away, the market is clearly lacking a catalyst that could keep the crypto rally going. Besides ether ETFs, it seems that the introduction of spot Bitcoin ETFs in different jurisdictions than the US is ticking all the boxes as it could reinforce Bitcoin’s universal adoption.

On Thursday, VanEck launched the first spot Bitcoin ETF in Australia, which becomes the second country in the Asia-Pacific region after Hong Kong to allow crypto funds to be listed on its stock exchange. Nevertheless, despite the initial euphoria, investors are going to closely monitor the net inflows of such investment products globally given that there is a significant probability that most of the institutional demand for the sector is already exhausted on the US Bitcoin ETFs.

Bitcoin breaks below 50-day SMA

BTCUSD has come under some selling pressure since its rejection at $71,995, which created a double top structure. Moreover, the decline accelerated following the break below the 50-day simple moving average (SMA), leading to a fresh one-month low on Friday.

Should selling pressures persist, Bitcoin could challenge the March support of $60,760. Further retreats could then cease at the March-April support region of $59,600.

On the flipside, if the price reverses back higher, the April resistance of $67,270 could prevent initial advances. Conquering this barricade, the bulls could aim for the double top region of $71,955.