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What's Next for Crypto After Bitcoin Slipped Below $29,500

Bitcoin (BTC-USD) previously correlated positively with the stock market. Nasdaq (QQQ) gained 2.09% in the week while the S&P 500 gained 1.05%. BTC-USD slipped below $30,000 and traded narrowly at $29,283 on July 29, 2023.

Bitcoin is in a consolidation pattern. Where it heads next depends on a few events ahead. SEC’s actions against crypto exchanges like Coinbase (COIN) would hurt BTC prices. However, after the court ruled against the SEC on Ripple, the regulator's impact on BTC prices will weaken.

Litecoin (LTC-USD) gravitated to the $90 level, a pattern that repeated frequently this year. Similarly, Ethereum (ETH-USD) spent most of its time at $1,900 since May 2023.

Higher Interest Rates Hurt Crypto Prices

Last week, the Federal raised interest rates again by 25 bps. This increases the attractiveness of holding fiat currency. At low risk, some US treasures pay over 5% in interest rates. Money Funds pay 5.2% in yield.

Crypto investors will need to weigh the return of 5.2% a year compared to the appreciation potential for the digital currency.

Your Takeaway

Watch for Bitcoin to return to the $30,000 level. Conversely, a retest toward $25,000-$26,000 is unlikely but possible. At that price, investors would pay less to increase their BTC holdings.