Markets
Why Bitcoin and Altcoins Are Falling
The cryptocurrency market is back in bear market mode as the global cryptocurrency market cap fell 20% to a low of $2.15 trillion today. market value has fallen by over 4.20% in the past 24 hours. Bitcoin price hit a 24-hour low of $57,800, falling back to the key support level, risking a breakdown to $52,000.
Altcoins including Ethereum, BNB, Cardano, XRPand Toncoin dropped by over 5%. Meanwhile, Solana ecosystem tokens and meme coins, as well as some AI coins witnessed a double-digit drop in the last 24 hours.
Cryptocurrency market sentiment dips again on fear amid panic selling by investors earlier Mount Gox $10 billion in BTC and BCH payments starting this week. JPMorgan and CoinShares have warned of market turmoil due to concerns over potential liquidation by creditors.
Cryptocurrency Market Officially in Bear Market
According to Coinglass, $300 million worth of cryptocurrencies were liquidated in the past 24 hours. Over 102,000 traders were liquidated, with the largest single liquidation order on cryptocurrency exchange OKX when someone exchanged ETH for USD worth $4 million.
Nearly $250 million worth of long positions and $50 million worth of short positions were liquidated in the past 24 hours. Investors lost more than $90 billion in the past 24 hours as the cryptocurrency market cap fell from $2.24 trillion to $2.15 trillion.
Meanwhile, more than 17,500 BTC options notional value of $1.02 billion are about to expire, with a put-call ratio of 0.76. The maximum pain point is 62,500, indicating that the Bitcoin price will remain under liquidation pressure as BTC fell below $59K today.
Notably, the put/call ratio in the last 24 hours has risen by over 1.09, with put volume above 17,200 and call volume close to 15,793. This indicates that options traders have turned highly bearish on Bitcoin.
Source: Deribit
Implied volatility (IV) across all terms shows significant declines, meaning that a market rally on uncertain price movements will see BTC price fall below $70,000.
Read too: XRP Lawsuit – Lawyers Claim Ripple Case Goes in SEC’s Favor, Chevron Ruling Irrelevant
Macroeconomic impacts continue to increase
Fed Chairman By Jerome Powell The latest speech and the release of the FOMC minutes confirmed Fed officials’ aggressive stance on rate cuts this year. The election saga with Trump leading after the last debate has added to the pressure, and Fed officials are awaiting more data on U.S. inflation and the labor market.
CME FedWatch indicates two rate cuts this year. The probability of a 25 bps rate cut in September jumped to 66.5% from 59% last week. Weak U.S. economic data have boosted the odds for Fed rate cuts this year.
US Dollar Index (DXY) held steady around 105.3 on Thursday after hitting a three-week low in the previous session. In addition, the yield on the 10-year U.S. Treasury fell to 4.35% after the latest ISM and jobs data showed a slowing labor market.
Analysts predict that a market recovery could happen at any time and shorting Bitcoin and altcoins could be the worst decision. Thus, they expect a consolidation near the current level and a recovery above $61,000 by the end of the week.
“A drop in USDT liquidity will not stimulate BTC growth, on the contrary, the growth will demonstrate demand for buying coins,” according to an on-chain analyst.
Read too: Donald Trump’s presidency could trigger a ‘global hash war’ with BTC reserves, says Bitcoin Maxi