First Mover Asia: Bitcoin Soars Past $44K as Ukraine Tensions Lessen

Good morning. Here’s what’s happening:

Market moves: Bitcoin and major altcoins rose after Russia said it was receptive to a diplomatic solution to tensions on the Ukraine border.

Technician's take: BTC's price jump occurred on low volume, indicating weak buying strength.

Catch the latest episodes of CoinDesk TV for insightful interviews with crypto industry leaders and analysis.

Prices

Bitcoin (BTC): $44,402 +4.0%

Ether (ETH): $3,170 +7.9%

Top Gainers

Asset Ticker Returns Sector Polygon MATIC +9.6% Smart Contract Platform Algorand ALGO +7.0% Smart Contract Platform Chainlink LINK +6.9% Computing

Top Losers

"There are no losers in CoinDesk 20 today."

Markets

S&P 500: 4,471 +1.5%

DJIA: 34,988 +1.2%

Nasdaq: 14,139 +2.5%

Gold: $1,853 -0.9%

Market moves

Russia took a baby step back from invading the Ukraine, at least it said it had. So investors were feeling more confident on Tuesday, which was good for stocks and for crypto.

Russia's statement that it had removed some troops from the Ukrainian border and would be receptive to a diplomatic settlement of the conflict it created at least temporarily removed the threat of higher oil prices. The price for crude fell on Tuesday.

At the time of publication, bitcoin was trading over $44,400, a 4% increase over the previous 24 hours. Ether, the second-biggest crypto by market cap, pushed past $3,150 and was up almost 8% over the same period.

Crypto's advanced dovetailed with the performance of major equity markets. The tech-heavy Nasdaq rose 2.5%, while the Dow Jones Industrial Average and S&P 500 increased 1.2% and 1.5%, respectively.

Investors remained concerned about an increase in the U.S. producer price index (PPI), which hit 9.8% in January, a continuation of the inflation that has hurt the country's economy and spurred the Federal Reserve to adopt a more hawkish monetary policy. OANDA Americas senior analyst Edward Moya wrote in an email that "factory-gate inflation remained very hot, prompting expectations for inflation to run hotter a little longer, and supporting the case for the Fed to kickoff their rate hiking cycle with a half-point rate increase."

Yet, Seth Ginns, managing partner and head of liquid investments at crypto investment firm CoinFund, struck an optimistic note for crypto during a discussion on CoinDesk TV's "First Mover" show. Ginns noted that the Fed had proceeded cautiously after a stronger-than-expected jobs report earlier this month and that crypto markets on Tuesday "shrugged off" the high PPI number. "Things are not slowing as much as expected, which meant there's no reason to think that the Fed is going to be data dependent at this point," Ginn said. "If they see things slowing, they're going to back off of tightening. If they see things [the PPI] continuing to remain strong, they're going to fight inflation."

He added : "We're in a fairly constructive risk-on regime right now."

Technician's take

Bitcoin Rally Stalls; Support at $40K, Resistance at $46K

Bitcoin (BTC) rose as much as 4% over the past 24 hours after buyers held support at $40,000. The cryptocurrency was trading near $44,000 at press time and appears to be overbought on intraday charts.

Pullbacks could be limited around $40,000 over the short term.

The latest rally occurred on low volume, similar to previous price jumps, indicating weak buying strength. Still, the relative strength index (RSI) on the daily chart is not yet overbought, which could keep buyers active on dips.

The RSI on the weekly chart continues to rise from the most oversold level since March 2020, which preceded a strong price rally. Momentum signals are also improving on the weekly chart, which is constructive so long as support above $30,000-$40,000 holds.

On the monthly chart, however, momentum signals remain negative, suggesting limited upside for BTC around $46,000-$50,000.

Important events

Australia Housing Industry Association new home sales (Jan. MoM)

9:30 a.m. HKT/SGT (1:30 a.m. UTC): China consumer price index (Jan. MoM/YoY)

12:30 p.m. HKT/SGT (4:30 a.m. UTC): Japan tertiary industry index (Dec./MoM)

3 p.m. HKT/SGT (7 a.m. UTC): U.K. consumer price index (Jan. MoM/YoY)

9:30 p.m. HKT/SGT (1:30 p.m. UTC): U.S. Producer Price Index

ETHDenver 2022

CoinDesk TV

In case you missed it, here is the most recent episode of "First Mover" on CoinDesk TV:

Cryptocurrencies on the Rise as Some Russian Troops Pull Back From Ukraine Border, A Year After the GameStop Mania: Lessons Learned From Meme Investing

"First Mover" hosts spoke with The Wall Street Journal "Heard on the Street" Editor Spencer Jakab as he explains the thesis of his latest book "The Revolution That Wasn't: GameStop, Reddit, and the Fleecing of Small Investors." Prices of bitcoin and altcoins are up following Russia's partial pullback of troops near the border with Ukraine. Seth Ginns of CoinFund provided his market analysis. Plus, CoinDesk's Nikhilesh De shared the latest news from the hearing of the couple with alleged ties to the 2016 Bitfinex hack.

Headlines

JPMorgan Is the First Bank Into the Metaverse, Looks at Business Opportunities:The Wall Street bank has opened a lounge in blockchain-based Decentraland.

Deutsche Bank Survey Shows Most Would Hodl Even If Crypto Markets Crashed:Data also showed men are much more active in the crypto space than women.

Binance Smart Chain Rebrands to BNB Chain:BNB Chain will be made up of two parts, BNB Beacon Chain and BNB Smart Chain.

Circle Launches ‘Digital Financial Literacy’ Module for Students at Bowie State and Rhodes Universities:The module will be available to students at the universities based in Bowie, Maryland, and South Africa in the coming months.

Voyager Digital Posts Income of $3.2M in Fiscal Q2, Plans to Add Equity Trading and NFTs:Revenue of $164.8 million for the quarter ended Dec. 31 more than doubled from the previous three months.

Fidelity International Debuts Bitcoin ETP in Europe: The product lists on the Deutsche Börse Xetra today and the SIX Swiss Exchange in the coming weeks.

Longer reads

Crypto’s Challenge: Right-to-Privacy vs. Right-to-Know: Two recent stories highlight the tension between an individual's right to anonymity and journalism's public mission.

Today's crypto explainer: What Is a DEX? How Decentralized Crypto Exchanges Work

Other voices: Cryptocurrency’s big Super Bowl ads sold FOMO, not the future

Said and heard

“In the medium term, there’s a lot of potential for Japan’s economy to accelerate,” (Izumi Devalier, head of Japan economics at Bank of America, to The New York Times) ... "This is about keeping Canadians safe, protecting peoples' jobs and restoring faith in our institutions." (Canadian Prime Minister Justin Trudeau) ... “I think that thanks to efforts in all these areas, it will be possible to come up with a very decent, comprehensive package result." (Russian Foreign Minister Sergey V. Lavrov, quoted in The New York Times) ... “There’s a huge lack of standardization." (Rob Catalanello, co-CEO of cryptocurrency market maker B2C2 Ltd, to The Wall Street Journal)