As a seasoned crypto investor with a few years of experience under my belt, I’ve grown accustomed to the volatility that comes with investing in Bitcoin and other cryptocurrencies. However, the sudden slide in Bitcoin price over the past 24 hours has left me feeling uneasy.
24-hour ago, Bitcoin‘s price experienced a sharp drop following its peak at $70,000, plunging by over 5% to around $66,000 on Tuesday. This dip can be attributed to the reported transfer of approximately $2 billion worth of Bitcoins by the U.S. government. The timing of this move has raised concerns as it occurred prior to the US Federal Reserve’s interest rate decision, leading some analysts to speculate about potential market manipulation or its impact on the broader crypto market.
Donald Trump-Driven Bitcoin Price Rally Fades
1. The Crypto Fear and Greed Index has decreased from 74 to 67, as investors are preparing for potential losses due to market volatility ahead of the Federal Open Market Committee (FOMC) meeting. Market anxiety escalated due to heightened geopolitical tensions in the Middle East and anticipation of a September rate cut.
1. Bitcoin’s weekly advance has primarily been reversed. The value of BTC surged to $70,000 during Donald Trump’s address at the Bitcoin Conference in Nashville, Tennessee last week. However, traders have dismissed current macroeconomics as the main reason for the stalled Bitcoin rally. Additionally, the 10-year Treasury has maintained its recent dip below 4.2%, approaching a level not seen since March. Furthermore, the U.S. Dollar Index (DXY) remains above 104.5.
At present, US stock market futures are rising as reported. According to CME FedWatch, there is a 90% likelihood that the Federal Reserve will reduce interest rates by 25 basis points in September. Furthermore, financial heavyweights Morgan Stanley and Goldman Sachs forecast three such cuts throughout the year, starting in September. Morgan Stanley stated, “Significant advancement in inflation allows the Fed to move nearer to rate reductions. Chair Powell needs to express heightened assurance.”
Traders Took Cues From U.S. Government Selloff and Mt. Gox
As a researcher studying the cryptocurrency market, I’ve noticed an intriguing trend: shortly after the U.S. government transferred over $2 billion worth of Bitcoin from the seized funds related to the Silk Road dark web marketplace, traders promptly sold off their BTC holdings. According to reports from Arkham Intelligence, this wallet, identified as belonging to the U.S. Department of Justice (DOJ), moved 29,800 BTC in two distinct transactions.
According to Bloomberg analyst James Seyffart, the large-scale Bitcoin transfer worth $2 billion by the US Marshals Service might be linked to a custody agreement with Coinbase. However, the price of Bitcoin has yet to recover due to a previous test transaction by Mt. Gox that caused traders to hesitate. It’s important to note that Mt. Gox presently holds approximately 80,128 BTC valued at around $5.35 billion.
The price of Bitcoin is presently at $66,716, with a recent low and high of $65,894 and $69,987 respectively in the last 24 hours. Notably, there has been a substantial surge in trading volume by around 67% over the same period.
As a researcher examining cryptocurrency market data from Coinglass, I’ve discovered that the market experienced approximately $170 million in total liquidations over the past 24 hours. Among these, around $147 million were long positions that got liquidated. Specifically, Bitcoin saw about $70 million in long liquidations, accompanied by roughly $7 million in short positions being liquidated.
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2024-07-30 13:34