Ethereum is set for another plunge, this fund manager believes
Ethereum Cryptocurrency
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Ethereum is set for another plunge, this fund manager believes
Ethereum's latest crash caused panic among investors across the market, especially as the second largest cryptocurrency in the market fell below the $1,000 mark. However, other investors feel that ETH is yet to bottom and the market should be prepared for another drop. Daniel Cheung, co-founder of Pangea Fund, believes that the worst months for cryptocurrencies could be July or August.
Since the digital asset sector follows macro movements such as inflation, as fund managers say, the market is currently in a macro trading mode. Ethereum recently traded at a correlation of 0.8 with the Nasdaq, judging by the Fed's rising freshness and unusually high inflation data, indicating that the cryptocurrency practically blindly mirrors patterns in traditional markets.
This pattern is unlikely to reverse in the coming months. Cheung highlights the two main factors that determine stock prices as future earnings and a multiplier of what you're willing to pay for those earnings in the future. Furthermore, given rising interest rate expectations, multiple compression has been a staple.
Ethereum Crash, Cryptocurrencies, Digital Market, Macro Movements, Nasdaq, Pangea Fund