Bitcoin back over $51K, crypto market recovers as Nvidia's earnings rejuvenates AI-tokens
|-
Bitcoin fell to as low as $50,700 late Wednesday, while ether dropped just under $2890 before reversing losses early Thursday.
-
Some traders said the sell-offs were expected and not indicative of a broader market trend, citing price-action analysis.
The crypto market hit multi-month highs earlier this week, declining a bit, before recovering early Thursday, as traders took profits and market observers looked to the earnings report of chipmaker Nvidia (NVDA) as a catalyst for movements.
Bitcoin (BTC) fell to as low as $50,700 late Wednesday, while ether (ETH) dropped just under $2890 before reversing some losses. Polygon’s MATIC led losses among crypto majors, slipping 7%, while Cardano’s ADA and XRP were down as much as 5%. Meanwhile, the CoinDesk 20 Index (CD20), a benchmark for the biggest and most liquid cryptocurrencies, dropped 1.2%.
Markets slumped in anticipation of Nvidia’s fourth-quarter earnings reports, which beat expectations and spurred a rally in artificial intelligence (AI) tokens. AI tokens saw a surge in activity last week on the back of OpenAI introducing its Sora product. The total market cap of AI tokens crossed $15 billion, with Worldcoin’s WLD hitting an all-time high.
The haphazard price action caused over $200 million in liquidations of crypto-tracked futures, of which $150 million were longs or bets on higher prices. Shorts, or bets on lower prices, were later impacted as the market recovered following the Nvidia report.
As such, some traders said the sell-off was expected and not indicative of a broader market trend, citing price-action analysis.
“Bitcoin has managed to avoid a sell-off without replicating the upward momentum observed in recent days,” said Alex Kuptsikevich, FxPro senior market analyst, in an email. “Technically, Ethereum’s pullback to $2700 is a correction of this month’s rally and should not cause much alarm. “A break below these levels could be a cause for concern for these assets,” he added.
However, some market participants are predicting the start of the alt season, but some remain cautious.
Markus Thielen, head of 10x Research, pointed to the continued dominance of bitcoin with a 51% market share in a report earlier this week. Thielen said dominance “needs to fall below 45%” for the altcoin season to begin.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.