Broad Crypto Market Update 8

Blood in the streets. Today we see Terra Luna trade below $1 after trading above $80 just 10 days ago. The implosion of Luna coincided with sharp declines across the entire crpytocurreny market, with BTC falling straight through the $35k support to the $28k level it is trading at now. Altcoins suffered just as mightily as BTC, with XRP going as low as $0.38 and Defi heavy project AVAX dropping to $30. As stated in previous notes, we are in a bear market and this is a continuation of the trend. The US inflation numbers came in hot today at 8.3%, and there are no signs from the federal reserve that their monetary tightening will slow. With multiple 50 basis point hikes planned for the rest of this year, it would not be surprising to see risk assets decline even further. However, the current market conditions have not changed very drastically since the end of the bullrun with the exception of interest rates. Many global economic factors are still positive, and the economic strains that typically lead to recession are not prevalent at the moment. Because of this, we could see a truncated bear market, but improvements in the supply chain, inflation, and employment will all need to be met before a resumption of growth. It is very likely that we see some relief rallies this month as the RSI across nearly all cryptocurrencies are extremely oversold. Sadly, catching these short lived bounces can become increasingly difficult in a bear market. It is advisable to keep an eye on the large stable coins used in Defi in the coming months, as the depegging of UST has rattled many investors. If possible, staying in collateralized stablecoins is preferable to unbacked stables. Now is a good time to begin accumulating high conviction projects, but it is important to keep some capital to deploy in the event of further downside. As always, risk management is extremely important in crypto. We have hopefully found the bottom, however there will likely be some projects run to nearly 0 before it is truly in. A drop below $23k in BTC is cause for concern, but we are far from that at the time being. NFA,DYOR.