Decentral Block Post

The price of CEL soared by nearly 50% as traders assessed its parent firm Celsius Network's inclination to return a portion of the locked funds to its customers.

No CEL-ling pressure for now

On the daily chart, CEL surged to its intraday high of $1.67 per token on Sep. 2 after lows of $1.15 the day before. However, the token's sharp rally accompanied lower trading volumes, suggesting a lack of conviction among traders about further upside moves.

CEL's gains appeared after Celsius Network filed a motion with the Bankruptcy Court, requesting that its clients with "certain Custody and Withhold accounts should be able to withdraw the amount of digital assets owed to them."

Celsius pulled itself up by taking cryptocurrencies from its clients and offering them mouth-watering returns by deploying their deposits in the broader crypto lending market.

But the market downturn this year created a $2.85 billion hole in Celsius's balance sheet, prompting the firm to freeze its clients' accounts, thus trapping billions of dollars of more than a million accounts. In July, Celsius filed for Chapter 11 bankruptcy.

The price of CEL soared by nearly 50% as traders assessed its parent firm Celsius Network’s inclination to return a portion of the locked funds to its customers.

No CEL-ling pressure for now

On the daily chart, CEL surged to its intraday high of $1.67 per token on Sept. 2 after lows of $1.15 the day before. However, the token’s sharp rally accompanied lower trading volumes, suggesting a lack of conviction among traders about further upside moves.

CEL’s gains appeared after Celsius Network filed a motion with the Bankruptcy Court, requesting that its clients with “certain Custody and Withhold accounts should be able to withdraw the amount of digital assets owed to them.”

Celsius pulled itself up by taking cryptocurrencies from its clients and offering them mouth-watering returns by deploying their deposits in the broader crypto lending market.

But the market downturn this year created a $2.85 billion hole in Celsius’s balance sheet, prompting the firm to freeze its clients’ accounts, thus trapping billions of dollars of more than a million accounts. In July, Celsius filed for Chapter 11 bankruptcy.

Bitcoin (BTC) returned to $20,000 on Sep. 2 amid renewed bets on a “short squeeze” higher.

Trader eyes $20,700 short squeeze trigger

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD recovering from another dip below the $20,000 mark on the day, continuing rangebound behavior.

The pair gave little insight into which direction the next breakout could be, with opinions differing on the surrounding environment.

Amid downside pressure on risk assets and a strong U.S. dollar, overall consensus appeared to favor long-term weakness continuing.

For popular trader Il Capo of Crypto, however, there was still reason to believe that a relief bounce could enter first. Thanks to the majority of the market expecting immediate losses to continue, a “squeeze” of short positions could hit, pushing spot price out of its multi-day trading range to target as much as $23,000.

From a bearish perspective, there's a fair probability that the crypto market entered a descending channel (or wedge) on Aug. 15 after it failed to break above the $1.2 trillion total market capitalization resistance. Even if the pattern isn't yet clearly distinguishable, the last couple of weeks have not been positive.

For example, the $940 billion total market cap seen on Aug. 29 was the lowest in 43 days. The worsening conditions have been accompanied by a steep correction in traditional markets, and the tech-heavy Nasdaq Composite Index has declined by 12% since Aug. 15 and even WTI oil prices plummeted 11% from Aug. 29 to Sept. 1.

Investors sought shelter in the dollar and U.S. Treasuries after Federal Reserve Chair Jerome Powell reiterated the bank's commitment to contain inflation by tightening the economy. As a result, investors took profits on riskier assets, causing the U.S. Dollar Index (DXY) to reach its highest level in over two decades at 109.6 on Sept 1. The index measures the dollar's strength against a basket of top foreign currencies.

More importantly, the regulatory newsflow remains largely unfavorable, especially after U.S. federal prosecutors requested internal records from Binance crypto exchange to look deeper into possible money laundering and recruitment of U.S. customers. Since late 2020, authorities have been investigating whether Binance violated the Bank Secrecy Act, according to Reuters.

Crypto investor sentiment re-enters the bearish zone

The risk-off attitude caused by Federal Reserve tightening led investors to expect a broader market correction and is negatively impacting growth stocks, commodities and cryptocurrencies.

From a bearish perspective, there's a fair probability that the crypto market entered a descending channel (or wedge) on Aug. 15 after it failed to break above the $1.2 trillion total market capitalization resistance. Even if the pattern isn't yet clearly distinguishable, the last couple of weeks have not been positive.

For example, the $940 billion total market cap seen on Aug. 29 was the lowest in 43 days. The worsening conditions have been accompanied by a steep correction in traditional markets, and the tech-heavy Nasdaq Composite Index has declined by 12% since Aug. 15 and even WTI oil prices plummeted 11% from Aug. 29 to Sept. 1.

Investors sought shelter in the dollar and U.S. Treasuries after Federal Reserve Chair Jerome Powell reiterated the bank's commitment to contain inflation by tightening the economy. As a result, investors took profits on riskier assets, causing the U.S. Dollar Index (DXY) to reach its highest level in over two decades at 109.6 on Sept 1. The index measures the dollar's strength against a basket of top foreign currencies.

More importantly, the regulatory newsflow remains largely unfavorable, especially after U.S. federal prosecutors requested internal records from Binance crypto exchange to look deeper into possible money laundering and recruitment of U.S. customers. Since late 2020, authorities have been investigating whether Binance violated the Bank Secrecy Act, according to Reuters.

Crypto investor sentiment re-enters the bearish zone

The risk-off attitude caused by Federal Reserve tightening led investors to expect a broader market correction and is negatively impacting growth stocks, commodities and cryptocurrencies.