Bitcoin’s Wild Ride: Is It Time to Panic or Party? 🎢💰

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What to know:

  • BTC‘s 12.6% slide from Monday to Wednesday is the biggest three-day drop since November 2022.
  • Tighter fiat liquidity and weakening of institutional demand led to the sell-off.
  • Tariffs threat, higher inflation expectations could keep markets from cheering Friday’s U.S. core PCE data.
  • Prices could slide to $74K in the worst case scenario, with potential demand zone around $82K.

Ah, Bitcoin, that fickle friend of ours, has decided to take a nosedive this week, leaving us all wondering if we should laugh or cry. The 12.6% drop in the first three days of the week is the largest since the infamous FTX fiasco. Who knew digital gold could be so… volatile? 💸

As the dust settles, we find ourselves in a familiar tale of disappointment. Investors are scratching their heads, wondering why President Trump hasn’t whipped up that national BTC reserve he promised. Meanwhile, institutional demand is slipping faster than a greased pig at a county fair, pushing the CME futures market into backwardation. Yes, that’s a fancy term for when spot prices are higher than futures. Who knew finance could be so dramatic? 🎭

And let’s not forget about Nasdaq, that tech-heavy index that seems to be having a meltdown of its own, adding to Bitcoin’s woes. It’s like watching a soap opera unfold, but with more numbers and fewer commercial breaks.

So, what’s next? The path of least resistance seems to be heading south, as the Trump tariffs saga heats up again. March 4 is looming like a dark cloud, and the first shots fired earlier this month have left the market in a risk-off mood. Buckle up, folks! 🚀

Bulls shouldn’t pin their hopes on Friday’s core PCE

For those of you hoping that Friday’s U.S. “core” Personal Consumption Expenditures (PCE) index will save the day, you might want to sit down. Noelle Acheson, the oracle of crypto, warns that disappointment could be on the menu. 🍽️

The core PCE, which conveniently ignores food and energy prices (because who needs to eat, right?), is expected to rise 2.6% year-on-year in January. But don’t get too excited; it’s down from December’s 2.8%. Slower inflation usually means the Fed might cut rates, but this time, the markets might just shrug it off. 📉

In fact, the Conference Board’s consumer confidence for February showed a jump in one-year inflation expectations to 6%. That’s a leap that would make a kangaroo jealous! 🦘

Acheson suggests that even if the PCE comes in softer than expected, it could be seen as a sign of economic weakness. So, we’re in for a whirlwind of concern, folks! 🌪️

But fear not! Acheson believes crypto could find its footing again, thanks to Bitcoin’s dual identity as both a risk asset and a digital gold. It’s like having your cake and eating it too! 🎂

Potential support levels/demand zones

According to the wise sages of technical analysis, a downside break of a prolonged range usually leads to a notable drop. So, if Bitcoin breaks below the $90K-$110K range, we might be looking at a slide to $70,000. Yikes! 😱

In a worst-case scenario, Bitcoin could drop to the $72,000–$74,000 range, where a rebound might occur. Markus Thielen, the founder of 10x Research, has his eyes on this potential demand zone. It’s like watching a game of chicken, but with more zeros involved. 🐔

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2025-02-27 10:13