Ethereum prices dropped on Wednesday as traders decided to secure their short-term profits at the cryptocurrency’s sessional high.
The second-largest blockchain asset plunged by up to 4.92 percent to its mid-March support level of $1,771. Its move downhill appeared mostly due to its strong positive correlation with Bitcoin, the world’s leading cryptocurrency by market cap. Bitcoin corrected by 4.89 percent from an intraday high just shy of $60,000.
The corrections appeared alongside a sharp uptick in the US dollar index. The index, which measures the greenback’s performance against a basket of top foreign currencies, rose to close March about 3 percent higher — its largest monthly gain since November 2016.
A stronger US dollar tends to reduce investors’ appetite for both riskier and risk-off assets. Bitcoin and Ethereum both surged by thousands of percent of percentage points in the previous 12 months as the dollar plunged.
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