The stagnation seen in the cryptocurrency market in recent weeks reveals that investors’ interest in the market has decreased and they are taking a cautious approach. Latest data from on-chain analysis platform Glassnode shows a significant decline in funding rates, especially for leading crypto assets Bitcoin (BTC), Ethereum (ETH), Solana (SOL), XRP and Dogecoin (DOGE).
Glassnode issues warning for Dogecoin and four cryptocurrencies
In an analysis recently shared on the He stated that it did not return to the seen levels. This shows that there is a lack of aggressive demand in the markets. Funding rates are directly linked to market sentiment and are considered an important indicator within the market.
High funding rates generally indicate that investors are optimistic and expect price increases in the future, so the market may be “overheated.” On the other hand, low funding rates often reflect bearish expectations, indicating that prices may fall. Glassnode stated that Bitcoin in particular showed positive momentum early last week, according to funding rates based on the 168-hour moving average. On the other hand, the downward trend in Solana’s funding rates continues since December. The lack of aggressive demand for long positions indicates that investors may have adopted a cautious attitude, and the market may follow a sideways course or experience slight pullbacks in the coming days.
What’s next?
So, what’s next? The cryptocurrency market is preparing for a critical week as investors await the next meeting of the US Federal Reserve (Fed) and important inflation data. With the Fed preparing to announce its next monetary policy decision at its January meeting on Wednesday, markets remain alert for possible impacts. In addition to the Fed meeting, new inflation data to be announced on Friday will also be followed closely.
The cryptocurrency market is currently under selling pressure; Investors are taking profits ahead of this year’s first Federal Open Market Committee (FOMC) meeting. At the time of writing this article, Bitcoin dropped by 3.83% to $100,954 in the last 24 hours and fell to $97,715 during the day. While the prices of Solana (SOL) and Dogecoin (DOGE) fell by 8.46% and 10.46% respectively in the last 24 hours, losses of up to 6% were seen in Ethereum (ETH) and XRP.
