Ether (ETH) price has shown weakness after failing to break above the $1,950 resistance on April 26. The subsequent correction drove ETH to $1,810 on May 1, nearing its lowest level in four weeks. Curiously, the movement happened while the First Republic Bank (FRB) was closed by the California Department of Financial Protection and Innovation.
Curiously, the movement happened while the First Republic Bank (FRB) was closed by the California Department of Financial Protection and Innovation.
The Federal Deposit Insurance Corporation (FDIC) entered into a purchase and assumption agreement with JPMorgan to protect FRB depositors, estimating a $13 billion loss.
Regarding this latest major U.S. bank failure, UBS analyst Erika Najarian stated,
“This deal does not change the rates, recession, and regulatory headwinds that regional banks are facing.”
ETH price ignores banking crisis
Curiously, the VIX indicator, which measures how traders are pricing the risks of extreme price oscillations for the S&P 500 index, reached its lowest level in 18 months at 15.6% on May 1.
It is worth noting that overconfidence is the main driver for surprise moves and large liquidations in derivatives markets, meaning low volatility does not necessarily precede periods of price stability.
The economic environment has worsened significantly after the U.S. reported its first quarter gross domestic product (GDP) growth of 1.1%, below the 2% market consensus. Meanwhile, inflation in Germany remained exceptionally high at 7.6% year-over-year in April. Investors are now pricing higher odds of a global recession as the U.S. Federal Reserve is expected to raise interest rates above 5% on May 3.
Meanwhile, inflation in Germany remained exceptionally high at 7.6% year-over-year in April. Investors are now pricing higher odds of a global recession as the U.S. Federal Reserve is expected to raise interest rates above 5% on May 3.
According to fundamental macro analyst Lyn Alden, the U.S. Treasury is now targeting $1.4 trillion in new net borrowing between April and September 2023 as tax receipts have been running below expectations.
The U.S. Treasury updated their borrowing estimates.
They target over $1.4 trillion in net new borrowing during the two quarters from April through September 2023, with an ending cash balance target of $600 billion.
Tax receipts have been coming in below their expectations. pic.twitter.com/qnA6QFqx4m
— Lyn Alden (@LynAldenContact) May 1, 2023
If the U.S. debt level…
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