Are Bitcoin and Ethereum set for green day, or are top cryptos still a basket case?

Crypto traders enjoyed a rare taste of positivity, or perhaps simply relief after what’s been a torrid start to 2022.

Even so, the morning’s ‘gains’ were on the meagre side of flat – with Bitcoin up 0.3% to US$41,382.

The leading crypto is still close to 40% below the all-time high seen in November. 

At this level, Ava Trade chief market analyst Naaem Aslam sees support and possible opportunity.

“Looking at Bitcoin’s historical price action, the US$40,000 level has proven to be a good support level for Bitcoin, and hence, investors should consider Bitcoin prices near the US$41,000 mark as an opportunity to purchase the digital coin at bargain prices,” said Aslam.

The Bitcoin sell-off was, according to Aslam, driven by external factors in the economic and financial system, namely central bank tightening.

“The main culprit behind the slump in crypto prices is the Federal Reserve’s (FED) decision to withdraw massive liquidity, which has been pumped into markets since the onset of the coronavirus pandemic,” he said in a note.

The Fed’s decision to wind down its quantitative easing measures at a much faster pace than investors had initially expected was unfavourable for risky and speculative like crypto, the analyst explained.

Ethereum this morning also saw a modest rise, up 1.3% to US$3,148 (and similarly to Bitcoin it remains more than 35% lower than its recently set all-time high).

Other ‘top cryptos’ were also on the front foot whilst not really setting alight too much excitement.

Solana and Polkadot, for example, gained 1.1% and 1.2% respectively.

Deeper down the crypto pecking order, meanwhile, Near Protocol, Polygon, Uniswap, Fantom, and Avalanche advanced 6.3%, 4.1%, 3.6%, 2.5%, and 2.1%. 

Doggy meme coin Dogecoin flinched 0.5% lower to US$0.150, while its closest rival Shiba Inu was off 1.0% at US$0.0000281.

Terra, Decentraland and Chainlink lost 4.8%, 3.4%, and 1.2% in value.