The global financial markets witnessed a sudden downturn on Tuesday as Russian President Vladimir Putin signed a decree allowing wider use of nuclear weapons. This move came in response to US President Joe Biden’s authorization for Ukraine to strike Russia with US missiles. As a result, stock markets around the world experienced sharp declines, leading to panic selling. The cryptocurrency market also saw a significant selloff, with Bitcoin, Ethereum, Solana, XRP, and other altcoins witnessing drops in their prices.
The sudden fall in stock markets and the cryptocurrency market can be attributed to the escalating tensions between Russia and Ukraine. Putin’s approval of using nuclear weapons against a non-nuclear state, with support from nuclear powers, has raised concerns globally. This geopolitical tension has also impacted the sentiment of investors, leading to a sell-off in various asset classes. The crypto market, in particular, saw longs being liquidated, resulting in a drop in prices across the board.
In response to these developments, US stock futures tied to major indices such as the S&P 500, Dow Jones Industrial Average, and Nasdaq Composite also fell. Companies like Coinbase and MicroStrategy saw their stock prices decline in the pre-market hours. Analysts have suggested that the market could witness further panic-triggered selloffs, with Bitcoin potentially dropping to $82,000. Key support zones for Bitcoin are identified at $85,800-$83,250 and $75,520-$72,880.
Despite the market turmoil, data from CryptoQuant CEO Ki Young Ju indicates that 99.3% of UTXOs are currently in profit. This suggests that most investors are still in a profitable position, despite the recent price drops. However, market sentiment remains fragile, as reflected in the Crypto market fear and greed index showing extreme greed. As a result, profit bookings are expected, which could further impact asset prices in the coming days.
In conclusion, the geopolitical tensions between Russia and Ukraine have had a significant impact on global financial markets, leading to sharp declines in stocks and cryptocurrencies. Investors are closely monitoring the situation for any further developments that could influence market sentiment. While the crypto market remains volatile, with potential for further selloffs, investors are advised to exercise caution and stay informed about the latest news and trends in the market.
