Bitcoin Price Crash: Here’s Why BTC Price Is Falling Today

by

As a seasoned crypto investor with over five years of experience in this volatile market, I’ve learned to navigate through the ups and downs of Bitcoin like a pro. The recent dip in BTC price is just another reminder that the crypto market can be unpredictable at times.

Bitcoin Price Dive: Lately, the price of Bitcoin has been attracting attention among investors, particularly due to its decline today. This drop follows a period where Bitcoin reached an all-time high (ATH) this week, surpassing $93,000. As investors try to understand the possible causes for this recent downturn, we delve into some of the leading explanations behind the Bitcoin’s dip.

Bitcoin Price Crash: Why Is The Crypto Falling Today?

It’s possible that multiple factors could explain the drop in Bitcoin’s price recently. Investors might be hesitant to jump in due to various large-scale economic occurrences and prevailing market tendencies that seem to be influencing their confidence levels.

US CPI And PPI Inflation Figures Weights On Sentiment

Recent American inflation figures indicate a significant rise in costs, causing apprehension among investors regarding a possible aggressive policy shift by the Federal Reserve. It’s worth noting that the U.S. Consumer Price Index (CPI) inflation this week climbed to 2.6%, marking an increase for the first time in eight months.

At the same time, yesterday’s U.S. Producer Price Index (PPI) inflation rate was 2.4%, higher than the predicted market value and an increase from the 1.9% seen in September. Interestingly, the Bitcoin price initially surged even with these unexpectedly hotter inflation figures. However, it seems that investors are currently maintaining a cautious stance.

The U.S. Federal Reserve carefully examines these collection of inflation statistics as they formulate their monetary policies. With the current surge in inflationary forces, worldwide investors are keenly observing any possible action by the central bank during their meeting in December.

BTC Price Slips As Bitcoin Miners’ Selling Spree Continues

Bitcoin miners are consistently unloading their acquired Bitcoins, which seems to be impacting the overall market’s outlook. This could potentially explain the recent drop in Bitcoin’s price. As per Julio Moreno, Head of Research at CryptoQuant, a miner active since the early days of Bitcoin (Satoshi-era) has recently disposed of 2,000 Bitcoins.

As stated by Moreno, these Bitcoins were mined in the year 2010 and have remained undisturbed by their miner ever since. However, with the current surge in prices, it appears that some of those mined Bitcoins have been transferred to exchanges. Furthermore, a recent analysis revealed that Bitcoin miners moved an additional 25,000 BTC just yesterday, which has further fueled the bearish market sentiments we’re experiencing now.

Bitcoin ETF Outflow Signals At Muted Market Interest

Over the past several days, there’s been a significant increase in investments into the US Spot Bitcoin ETF, creating a sense of market enthusiasm. Yet, on November 14th, these investment tools saw an outflow of approximately $400.7 million, marking the end of a six-day streak where inflows were observed, according to data from Farside Investors.

Although the BlackRock Bitcoin ETF (IBIT) has seen an investment of $126.5 million, funds like Fidelity’s FBTC and Ark Invest’s ARKB have actually been withdrawing money. However, even with this recent withdrawal, the total inflow into U.S. Spot Bitcoin ETFs since their launch on January 10th has reached a whopping $27.8 billion.

Profit-Booking Opportunity and Whale Dump

With Bitcoin’s price hitting a new all-time high, it seems many investors are seizing the moment to cash out their gains. Notably, as per data from Lookonchain, a substantial investor (often referred to as a ‘whale’) has transferred 1,920 Bitcoins, approximately $169 million, to Binance in recent times. Over the past three days, this whale has unloaded a total of 4,060 Bitcoins, worth around $361 million, onto the same top cryptocurrency exchange.

These large-scale sales indicate that investors may be cashing out during the current price increase. Given this situation, investors are becoming increasingly anxious that a continued sell-off could further pressure the price of Bitcoin, possibly leading to another decline in the near future.

Historical Trends Signals At Bitcoin Price Pullback

Regardless of the recent dip in Bitcoin’s value, several experts continue to express positivity regarding Bitcoin’s future price trends. To put it into perspective, past records show that Bitcoin usually experiences a minor correction during an upward trend, later resuming its surge towards record-breaking highs.

Given that many believe the present drop is a typical fluctuation within the crypto market, they remain optimistic about its future growth. As per renowned market expert Rekt Capital, these dips during a bull run provide investors with chances to purchase Bitcoin at reduced costs. Therefore, it seems that this dip could potentially increase BTC prices in the near future.

Will Bitcoin Price Crash Continue?

Today’s BTC price experienced a drop of almost 4% as I was writing this, and it was traded at approximately $87,508. The trading volume also decreased by around 27% to about $85 billion. It is worth mentioning that in the last 24 hours, Bitcoin reached a peak of $91,765, following its all-time high of $93,434 on November 13. Additionally, there was a significant decrease of over 3% in the Open Interest for Bitcoin Futures, suggesting reduced enthusiasm from market participants.

Recently, in a post I came across, Ali Martinez mentioned that a staggering $5.42 billion in Bitcoin profits were reaped as its price skyrocketed. This noteworthy event has also elevated the sell-side risk ratio to 0.524%, serving as a signal for investors to exercise caution.

Additionally, at the time of writing, the Relative Strength Index (RSI) for Bitcoin was 74, suggesting it’s overbought. This short-term condition may cause some worry and a recent price dip in Bitcoin, but many within the community are optimistic about its long-term growth. Notably, analyst Peter Brandt predicts that Bitcoin could reach $327K soon.

Read More

2024-11-15 11:34