Bitcoin, Dogecoin, Shiba Inu Falling Drastically: Here’s Why

by

As a seasoned crypto investor with a few years of experience under my belt, I’ve seen my fair share of market ups and downs. Today’s news of Bitcoin’s slide below $67,000 following the release of softer-than-expected US inflation data and the Federal Reserve’s hawkish stance is nothing new to me.

The cryptocurrency market is experiencing a reversal of its gains from Wednesday after the US released inflation data. The price of Bitcoin reached a high of $70,000 but has since dropped below $67,000. Several experts predict that if Bitcoin falls below $66,000, further declines could occur, potentially reaching $64,000.

The prices of Ethereum, Solana, XRP, and other altcoins are decreasing, with Ethereum dropping by nearly 5% to reach $3,450, Solana falling by around 7% to $147, and XRP experiencing a 3% decline to hit $0.48, based on information from CoinGecko.

Meme coins have experienced significant declines, with Dogecoin and Shiba Inu taking the lead among major cryptocurrencies. Dogecoin is currently pushing down on its support level at $0.14, abandoning an earlier potential surge to $0.2. Shiba Inu faces the risk of slipping below its crucial support at $0.00002, but hovered around $0.000021 on Thursday.

Why Is Bitcoin Falling As DOGE, SHIB Tumble

The American inflation figures, specifically the Consumer Price Index (CPI), were reported lower than anticipated on June 12th. Subsequently, bitcoin and other cryptocurrencies displayed optimistic price movements following a steep decline to $66,000 on Tuesday.

After the Federal Reserve’s FOMC meeting on Tuesday and Wednesday, the hawkish stance adopted by the Fed caused a roadblock for bulls trying to push the price above $70,000. Jerome Powell, the Fed chair, dampened investor hopes when he stated that the central bank is not currently considering interest rate reductions.

The comments were made in conjunction with the announcement to keep interest rates between 5.25% and 5.5%, and to reduce the anticipated number of rate reductions from three to just one.

The FOMC members indicated that the Federal Reserve has taken a small step toward reaching its 2% inflation goal, but they were firm in their decision not to reduce interest rates. Inflation in the United States has decreased from the high levels it reached in 2022 and 2023.

“Powell expressed confidence in the effects of the restrictive policy, acknowledging that its full impact and sufficient strength would become clearer over time.”

PPI Inflation Data Fails To Ignite Bitcoin Bulls

The latest U.S. Producer Price Index (PPI) figures indicate that inflation is showing signs of abating, having come in below the forecasts of economic experts. This news is positive for riskier investments such as cryptocurrencies and stocks.

Despite regaining some ground initially, Bitcoin and cryptocurrency prices ultimately lost steam, allowing bears to retake control. Analysts at QCP Capital, a well-known trading firm, indicate that investors are currently grappling with uncertainty about the market’s future direction, particularly in light of the Federal Reserve’s continued reluctance to consider interest rate reductions.

As a crypto investor, I’m eagerly anticipating the possibility of a interest rate reduction by the Federal Reserve in September. It seems that the Fed may take a cautious stance and adopt a “wait-and-see” approach for their upcoming meetings in November and December.

Instead, the green light for ETFs based on Ethereum spots might momentarily alleviate concerns over interest rates and instill optimism for the market perspective, both in the near term and the long run.

Bottom Line

As a market analyst, I believe the upcoming days hold significant importance for Bitcoin and other altcoins. Should these digital assets manage to uphold crucial support levels, we could witness a more robust rebound. It’s essential to keep an eye on meme coins such as Dogecoin and Shiba Inu, as they have a tendency to follow Bitcoin’s price movements.

Read More

2024-06-13 21:23