Crypto traders' optimism fades

[Ben Graham]

The cryptocurrency market has returned to decline. Bitcoin has already fallen to $86,000, while Ether traded around $2,780, further worsening an already difficult position for buyers.

On top of that, the latest data shows spot Bitcoin ETFs recorded a net outflow of $1.33 billion last week. Spot Ether ETFs also saw outflows. That negative trend is increasing pressure on the market and undermining traders' confidence in a recovery. Several factors underlie the ETF withdrawals.

First, it is profit taking after an early?year rally. Many speculative traders who entered at lower levels judged current prices high enough to lock in gains.

Second, it is rising concern about the global macroeconomic outlook. Geopolitical instability and renewed tariff threats from Donald Trump have prompted investors to rethink portfolios and cut positions in risky assets, including cryptocurrencies.

Third, it is uncertainty about the legislative outlook. There is still no clarity on CLARITY. The proposed new text was immediately rolled back by lawmakers. Regulatory uncertainty about rules for cryptocurrencies is also deterring new investment and prompting exits by existing holders. Many institutional investors are waiting for clearer signals from regulators before making long?term commitments to digital assets. In a falling market and with a negative news flow, prospects for Bitcoin and Ether look bleak.

Trading recommendations:

From a technical standpoint, buyers of BTC are now targeting a return to $88,500, which would open a direct path to $90,500 and then $92,100. The extended target is the peak near $94,000. A break above that level would signal attempts to restore a bull market. On the downside, buyers are anticipated at $86,300. A drop below that area could quickly push BTC toward $83,200, with the furthest downside target near $81,200.

As for Ethereum, a clear consolidation above $2,887 would open a direct route to $2,970. The extended target is the peak near $3,050. Surpassing that level would strengthen bullish sentiment and renew buyer interest. If ETH falls, buyers are expected at $2,789. A move below that zone could rapidly send ETH down to about $2,684, with the furthest downside target near $2,585.

What we see on the chart:

- Red lines indicate support and resistance levels where either a price slowdown or active growth is expected;

- Green lines indicate the 50-day moving average;

- Blue lines indicate the 100-day moving average;

- Light green lines indicate the 200-day moving average.

Typically, a crossover or price test of these moving averages either halts market momentum or sets a new directional impulse.

The material has been provided by InstaForex Company - www.instaforex.com