Over the last 24 hours the cryptocurrency market showed a slight uptick. In particular, the change in the value of ETH, which jumped by almost 6 percent during the day, was a pleasant one. Here is a chart of the changes in the value of the top coins.

Changes in cryptocurrency rates over the past 24 hours

It’s worth noting that the cryptocurrency exchanges’ balance in ETH, meanwhile, fell to its lowest in four years. As reported by Glassnode, the figure as of yesterday stood at 20,052,791 ETH.

Graph of cryptocurrency exchanges’ balance in ETH

This trend can be explained by investors’ desire for new coins in case of a fork of Etherium during its transition to Proof-of-Stake. Still, if ETH ends up in a personal non-custodial wallet, tokens will be credited to the same address on other networks.

That said, the prospects for forks are still unclear. However, Bitcoin has been forked many times since its inception, with BTC holders receiving new coins.

Bitcoin’s main support level

While BTC is still trading above $20,000, the cryptocurrency has never been able to show impressive growth this summer. The rise to $25,000 a few weeks ago went virtually unnoticed, as now Bitcoin’s local rally has been “wiped out” by a new wave of collapse.

Bitcoin exchange rate on the scale of the 4-hour chart

A well-known crypto trader under the nickname Il Capo of Crypto expects the global downtrend to continue, although Bitcoin could still allegedly rise as much as $23,000 before a new plunge. Here’s the trader’s rejoinder, in which he shares his view of the current situation.

A lot of people are waiting for BTC to fall to $19,000, but far fewer traders expect the growth up to $23,000. This is easy to judge by the funding rate. Also, above $21k there is quite a lot of liquidity. It’s time to squeeze out those short positions.

In other words, according to the expert, too many traders are now playing short. A strong upward movement of Bitcoin price may lead to mass liquidation of their positions, which will lead to a local rebound up to $23 thousand. Again, this version remains only a probability, which may well fail to materialize. In a volatile cryptocurrency market, anything is possible one way or another.

What’s happening to the US stock market

Last week, US Federal Reserve Chairman Jerome Powell gave a short speech during the annual economic conference in Jackson Hole Valley, and the market reacted negatively to the speech. Here is one of his quotes published by the Cointelegraph news outlet.

At some point, as monetary policy tightens further, it will probably become appropriate to slow the pace of credit rate increases. Restoring price stability may require the continuation of restrictive policy for some time. Historical experience strongly warns against a premature loosening of economic policy.

In other words, the Fed chief made it clear that even if inflation has peaked, no significant easing of the current measures by the authority should be expected for the time being. It appears that the Fed will be planning to consolidate its own success and therefore an increase in the benchmark interest rate - albeit with less intensity - is certain to catch on.

Global stock market collapse after Powell’s speech

Powell did not give any clear insights into the future operation of the US Federal Reserve, but his speech was received very negatively by the markets. Immediately after the speech, global stock market capitalisation collapsed by $2 trillion – almost double the entire capitalisation of the cryptocurrency niche.

According to Paul Christopher, head of global markets strategy at Wells Fargo, the main US stock index, the S&P 500, could collapse even lower on the news from Jackson Hole. Christopher predicts the index to fall as much as 4,000 points.

S&P 500 Index

As a reminder, crypto is still heavily dependent on stocks, so any negative news for the stock market is doubly reflected in the price of Bitcoin and other coins. All this will continue as long as the US Federal Reserve raises the country's benchmark lending rate to fight inflation. This is a necessary measure for the US economy right now, but it also makes it very difficult to borrow investment capital at the moment, which is causing markets to fall.

Outlook on the dollar index

The Dollar Index (DXY) has reached a new high since September 2002. It shows the change in value of the US national currency against a basket of the world’s six most popular currencies – the euro, Japanese yen, Canadian dollar, British pound, Swedish krona and Swiss franc.

A rise in the index leads to another wave of declines in markets and other currencies as their valuation in the more expensive dollar declines. Recently, for example, the value of the euro has even fallen below the value of the dollar, which has not been the case for quite some time. As long as the DXY is near its highs, you can't expect crypto to rise - only a noticeable reversal in the trend of the index will be another signal for the bull run. In that case, investors will want to avoid being linked to a depreciating dollar and will look for assets to protect their own savings. Actually, that is the usual explanation for this trend.

DXY dynamics


From the looks of it, the cryptocurrency market doesn't seem to have much reason to be positive at the moment. That said, the key event to attract investors' attention to the coin in September remains the possible transition of Etherium to Proof-of-Stake. A successful upgrade of such a large-scale blockchain project could well create the necessary momentum for a further turnaround. However, many experts agree that the current bear market should last much longer. So there is still no certainty at the moment.


Stay tuned for more market developments in our Millionaire Crypto Chat. There we will discuss other important developments related to the blockchain and decentralisation industry.

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