Bitcoin Price- Bitcoin Market Faces Huge Losses Amid Fed’s Rate Plans
Bitcoin Price– Bitcoin has encountered significant turbulence after a macroeconomic scare abruptly halted its bull market. The cryptocurrency, which had been on a bullish rally, has seen its price drop by over $12,000 in just two days, leaving traders and analysts speculating on even lower targets for Bitcoin’s price.
Bitcoin Drops Below Key Support Level: $90,000 Not the Bottom
On December 19, Bitcoin’s price plunged to $96,000, alarming both retail and institutional investors. According to data from CoinGlass, combined crypto market liquidations during the 24 hours leading up to December 20 amounted to nearly $900 million. Bitcoin exchange-traded funds (ETFs) also saw their largest outflows on record, with $679 million pulled from US spot Bitcoin ETFs, according to Farside Investors.
Despite the market’s sharp downturn, some analysts believe this drop may not be the final bottom. BitQuant, a well-known crypto commentator with a historically bullish outlook on Bitcoin, stated that Bitcoin’s recent dip to $90,000 was not the market bottom. He emphasized that BTC/USD still faces the potential for further downside, projecting that the price could dip to the mid-$80,000 range next. Sorry, but no, $90K was not the dip, BitQuant wrote in response to inquiries about when the market might reverse.
Market Sentiment and the Risk of Further Losses
The market’s current vulnerability can be attributed to a combination of macroeconomic factors. Following shifts in US monetary policy, the broad risk-asset rally, including Bitcoin, lost steam. On December 19, the Federal Reserve’s decision to slow its rate-cutting pace for 2025 amid rising inflation concerns caused significant market uncertainty, which impacted Bitcoin and other risk assets.
Bitcoin, alongside other cryptocurrencies, is now considered “extremely vulnerable” to further market declines. As macroeconomic uncertainties persist, investors and traders are urged to remain cautious and vigilant.
Future Outlook: A Tough Road Ahead
Bitcoin’s struggle for support after its recent drop has left traders on edge, particularly as analysts project the potential for more downside. While some long-term Bitcoin bulls, like BitQuant, remain optimistic about the asset’s future, the current market environment poses significant risks. Investors are advised to monitor Bitcoin’s price action closely and consider the broader economic context, including future decisions from the Federal Reserve, which could continue to impact the market’s trajectory.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.
Leave a comment