Should You Be Worried About Bitcoin’s Two-Year Low?
Anyone with Bitcoin can sell a set amount on an exchange, regardless of where they live in the world. The current market price for purchasing Bitcoin at each exchange is set by the lowest seller there. The market price for selling Bitcoin at each exchange is set by the highest buyer there.
The price of Bitcoin (BTC) dropped by 7.8% more over the last day, reaching a daily low of $18,420. Despite the fact that at the time of writing, the leading cryptocurrency has marginally returned above $19.2K. This is the second substantial loss in the previous week. It has driven Bitcoin down by more than 18%, or to lows not seen since the end of 2020.
Data from Coinglass shows that since early Sunday, September 18, almost $400 million worth of long spot orders on Bitcoin have been liquidated, posting noticeably high amounts the previous two days.When Bitcoin’s market share fell to 39.3%, its lowest level since the middle of 2018, the wider digital asset market experienced a sudden upsurge in anxiety. The market’s overall value decreased to $903.2 billion after key coins like Ethereum (ETH), Ripple (XRP), and Cardano (ADA) suffered double-digit losses. The market fell by six points in a single day, according to the Crypto Dread and Greed Index, entering “severe fear” zone once more.
Fed Rate Increase Worries Could Fuel Crypto Crash
As investors wait for the United States Federal Reserve (Fed) to announce another significant interest rate hike on Wednesday, September 21. The fall in bitcoin prices corresponded with the larger dip in stock markets, which also fell early on Monday.
The next interest rate hike could go down in history as the greatest in the last 40 years, according to the markets. In order to curb the 8.3% inflation, financial experts predict that the US central bank may increase interest rates by 0.75 percentage points to 3% or perhaps “by an unprecedented one full percentage point to 3.25%.”
Investors worry about the Bank of England’s announcement this Thursday. When it is anticipated to raise interest rates by 0.75 percentage points. Furthermore, other central banks throughout the world are also preparing to raise interest rates. Despite the claim that the action is intended to stop the historically high inflation rates. Financial markets are currently experiencing volatility as a result.
Bearish Sentiment of Bitcoin
Bitcoin is moving in a positive correlation. In tandem with the values of the stock market. In contrast to the common perception that it is a safe-haven asset. This indicates that the major cryptocurrency is still quite sensitive to changes in the stock market and the macroeconomic environment. Like as concerns of a global recession and tightening monetary policy.
For the month of September, sellers dominated the market for Bitcoin options, which are financial contracts that grant the right to buy or sell an asset at a specified price. On the other hand, historically speaking, September has been viewed as a pessimistic month for Bitcoin prices. Additionally, the warning from Goldman Sachs experts is interesting. Bitcoin would hit a new low of $12,000. This is if the US central bank raises interest rates sharply is being widely discussed in the cryptocurrency industry.
