The cryptocurrency market has experienced a significant downturn, with Bitcoin leading the charge as its price fell below the crucial $60,000 support level.
The sudden crash, which has seen the world’s largest cryptocurrency hit a 2-month low, has sent shockwaves through the market, causing major altcoins such as Ethereum and XRP to follow suit. The total cryptocurrency market cap has shed approximately $500 billion since its recent peak of $2.9 trillion.
TLDR
Bitcoin price has fallen below $60,000, hitting a 2-month low and wiping out $500 billion from the crypto market cap.
The drop is attributed to a “perfect storm of negatives,” including stalled Bitcoin ETF inflows, unlikely Ethereum ETF approval, and escalating conflict in the Middle East.
The Federal Reserve’s interest rate decision and commentary on the trajectory of rates could significantly impact markets.
U.S. Treasury Secretary Janet Yellen’s general account refinancing decision is also expected to influence the market.
Technical indicators suggest a bearish trend for Bitcoin in the short to medium term, with potential support levels at $52,000 and $48,500.
Analysts attribute this sharp decline to a “perfect storm of negatives” that has hit the market. One of the primary factors is the stalling of Bitcoin ETF inflows, which has dampened investor sentiment. Additionally, the likelihood of Ethereum ETFs being approved in May has diminished, further contributing to the bearish mood.
Geopolitical tensions have also played a role in the market downturn, with the escalation of conflict in the Middle East pulling down risky assets like cryptocurrencies. As investors await the Federal Reserve’s interest rate decision and commentary on the future trajectory of rates, uncertainty has gripped the market.
Furthermore, U.S. Treasury Secretary Janet Yellen’s upcoming announcement regarding the Treasury’s general account refinancing decision is expected to have a significant impact on the market.
Some analysts, such as Arthur Hayes, founder of the Maelstrom investment fund, believe Yellen’s decision could be more influential than the Fed’s actions.
Despite the current bearish sentiment, some experts remain optimistic about the long-term prospects of Bitcoin and Ethereum. Standard Chartered’s head of FX and crypto research, Geoff Kendrick, maintains that Bitcoin could reach $150,000 this year, while Ethereum is predicted to more than double to $8,000.
Technical indicators, however, suggest that the bearish trend may persist in the short to medium term. Bitcoin’s price action has confirmed a downtrend, with the cryptocurrency breaking key support levels and the weekly MACD indicating a bearish cross. If the correction continues, the next levels of support to watch are $52,000 and $48,500.
As the market navigates this turbulent period, investors and traders alike are closely monitoring developments from the Federal Reserve, the U.S. Treasury, and geopolitical events
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