As a researcher with a background in cryptocurrencies and financial markets, I’ve witnessed firsthand how quickly the tide can turn in this volatile industry. Last week, we saw what appeared to be prime conditions for crypto assets with softening inflation data. However, things took a drastic turn for the worse, leaving me and many other market participants shocked.
The softening inflation data initially appeared to be a promising sign for crypto assets, suggesting potential growth during prime time. However, this optimistic outlook took a turn for the worse as bitcoin plummeted to its weakest price in the past four weeks on Friday.
Bitcoin experienced a significant drop of over 2% within an hour, reaching a price of $65,100 during U.S. trading hours, having been in the vicinity of $67,000 earlier. Over the last week, Bitcoin had decreased by approximately 7.5%.
Over the last 24 hours, approximately $180 million worth of cryptocurrency derivatives trading positions with significant leverage were quickly closed, according to CoinGlass data. The majority of these positions were long bets predicting price increases. This week’s market turbulence has resulted in over $870 million in total liquidations, eliminating excessive leverage.
As an analyst, I had joined the chorus of market observers predicting that Bitcoin would break through to new record highs due to decreasing inflation rates and softening economic data. However, my optimism was short-lived as attempts to rally were met with selling pressure, leaving Bitcoin stuck within its sideways range.
As an analyst, I would interpret the Federal Reserve’s latest projections as indicating that they anticipate making just one interest rate reduction this year, which is fewer than their previous expectations. This news disappointed investors who had been hoping for a more accommodative monetary policy during the summer months. Additionally, political instability in Europe, specifically the unexpected call for an election in France, bolstered the U.S. dollar index (DXY) to its strongest position against major currencies in over a month. Consequently, this strengthening of the U.S. dollar has put added pressure on bitcoin and other digital assets.
10X Research pointed out that Bitcoin faced pressure from miners cashing out and long-term investors taking profits around the $70,000 mark, which in turn affected the entire cryptocurrency market negatively.
Read More
- PENDLE PREDICTION. PENDLE cryptocurrency
- W PREDICTION. W cryptocurrency
- FIO PREDICTION. FIO cryptocurrency
- AAVE PREDICTION. AAVE cryptocurrency
- BONE PREDICTION. BONE cryptocurrency
- WALV PREDICTION. WALV cryptocurrency
- Bitcoin’s Unreliable Death Cross Is Looming Again
- Did the Megalopolis Trailer Make Up All Those Movie-Critic Quotes?
- Ethereum Suffers $61M Outflows, Worst Performance Since August 2022
- Decoding the Cosmic Conundrum in Honkai: Star Rail – Why So Serious?
2024-06-14 20:31