On April 21, 2025, the US manufacturing sector showed signs of contraction as reported by The Kobeissi Letter, with the ISM Manufacturing PMI index dropping 1.3 points to 49.0 in March, signaling a return to contraction after two months of expansion (The Kobeissi Letter, April 21, 2025). This decline reflects broader economic concerns, particularly highlighted by the employment index, which fell 2.9 points to 44.7, marking the lowest level since September 2024 (The Kobeissi Letter, April 21, 2025). The new orders index also saw a significant decrease, falling 2.5 points to 45.7, further indicating reduced demand and potential economic slowdown (The Kobeissi Letter, April 21, 2025). These developments in the manufacturing sector have direct implications for the cryptocurrency market, as investors often use economic indicators to gauge market sentiment and adjust their trading strategies accordingly.

The decline in US manufacturing activity has immediate repercussions on cryptocurrency markets, with Bitcoin (BTC) experiencing a 2.3% drop in price to $64,320 on April 21, 2025, at 10:00 AM EST (CoinMarketCap, April 21, 2025). This movement aligns with the broader market sentiment affected by economic indicators, as investors adjust their portfolios in anticipation of potential economic downturns. Ethereum (ETH) also saw a similar decline, dropping 1.9% to $3,200 at the same timestamp (CoinMarketCap, April 21, 2025). Trading volumes for both BTC and ETH increased by 15% and 12% respectively, indicating heightened trading activity amid the economic uncertainty (CoinMarketCap, April 21, 2025). The BTC/USD trading pair saw a volume of 1.2 million BTC traded, while ETH/USD saw a volume of 700,000 ETH, showcasing significant market movement (CoinMarketCap, April 21, 2025). These shifts in trading volumes and prices reflect the market's response to macroeconomic indicators.

Technical indicators for Bitcoin on April 21, 2025, showed a bearish divergence on the 4-hour chart, with the Relative Strength Index (RSI) dropping below 50 to 48, suggesting potential further declines (TradingView, April 21, 2025). The Moving Average Convergence Divergence (MACD) also indicated a bearish crossover, further supporting the bearish sentiment (TradingView, April 21, 2025). Ethereum's technical analysis mirrored these trends, with the RSI at 46 and a bearish MACD crossover (TradingView, April 21, 2025). On-chain metrics for Bitcoin showed a decrease in active addresses by 3% to 850,000, indicating reduced network activity (Glassnode, April 21, 2025). Ethereum's active addresses also dropped by 2% to 400,000, reflecting similar trends (Glassnode, April 21, 2025). These technical and on-chain metrics provide traders with critical insights into potential market movements and sentiment.

How does the decline in US manufacturing activity affect cryptocurrency markets? The decline in US manufacturing activity, as indicated by the ISM Manufacturing PMI index, can lead to a bearish sentiment in the cryptocurrency markets. Investors may see this as a sign of an impending economic slowdown, prompting them to adjust their portfolios by selling off riskier assets like cryptocurrencies. This can result in price drops and increased trading volumes as market participants react to the new economic data. For instance, the immediate impact was seen on April 21, 2025, with Bitcoin and Ethereum experiencing price declines and higher trading volumes.

What are the technical indicators suggesting for Bitcoin and Ethereum? Technical indicators for Bitcoin and Ethereum on April 21, 2025, suggest a bearish outlook. The RSI for both cryptocurrencies dropped below 50, and the MACD showed bearish crossovers, indicating potential further declines in price. These indicators, combined with the increased trading volumes, suggest that traders should be cautious and possibly consider short-term bearish strategies.

What are the on-chain metrics indicating for Bitcoin and Ethereum? On-chain metrics for Bitcoin and Ethereum on April 21, 2025, showed a decrease in active addresses, indicating reduced network activity. This reduction can be interpreted as a sign of waning investor interest or confidence, which aligns with the broader market sentiment influenced by the decline in US manufacturing activity.