Today Bitcoin is extending its losses, dropping below $30,000 for the first time since January. The world’s largest cryptocurrency by market capitalization is on the losing end right now due to China toughening restrictions on crypto by forcing its banks and other financial entities to block any transactions with cryptocurrencies and close any account associated with any crypto transactions.
The cryptocurrency market is experiencing panic at the moment. Some experts have warned that if the strong support at 30K falls, Bitcoin could slide to 20K or even lower as sentiment turns negative and people hasten to sell their cryptocurrency holdings.
Meanwhile, Federal Reserve Chair Jerome Powell will be testifying before Congress today. Powell will update US lawmakers on the current amount of stimulus the central bank is providing for the economy. He is likely going to get drilled on the latest shift in sentiment among Fed governors, with now the majority of them supporting an interest rate hike in 2023 instead of 2024, like expected earlier.
US stock indices are going to trade slightly lower today in anticipation of the testimony. They reacted quite negatively to the Fed’s statement last week, so any further reminders and clarifications of that surprising hawkishness will upset indices slightly.
Moreover, the impact of Redditors’ meme stock short squeeze earlier this year continues to be felt. White Square Capital, a UK-based hedge fund, announced that it is closing down after incurring heavy losses earlier this year. It was one of the hedge funds involved in heavily shorting the stocks of GameStop, among other companies that suffered during the pandemic.
Other than that, the economic calendar is fairly empty today. There was a consumer confidence report out of the Netherlands earlier, which showed a mild improvement from last month. The eurozone flash confidence report for June will be published later today.
In other news, crude oil today rose to its highest level since early 2019. Brent managed to surpass $75 per barrel before retreating to $74.45, while the WTI brand is trading around $72.58 at the moment.
