Bitcoin experienced a major crash, with the price falling below the psychological level of $100,000 last night.
Evaluating the recent decline in Bitcoin, Singapore-based analysis firm QCP Capital examined the main reasons for the decline.
At this point, QCP analysts stated that the decline in Bitcoin was due to a stronger dollar and uncertainty about the Fed’s actions, and that this decline below $100,000 also negatively affected the risk appetite.
Analysts noted that this decline in risk appetite and ongoing macro pressure were also reflected in US spot Bitcoin ETFs, with ETFs recording a net outflow of approximately $1.3 billion for four consecutive days.
Analysts noted that weaker spot demand for Bitcoin coincided with forced deleveraging, leading to liquidations exceeding $1 billion in long positions, and that investors in the options market were also stepping up hedging activities around $100,000.
Analysts stated that the data currently points to a technical decline in Bitcoin, emphasizing that uncertainty still prevails on the FEWD front.
The Fed’s 25 basis point rate cut in October, coupled with rare opposition, has been met with a cautious stance that has pushed back expectations of a new rate cut in December.
Currently, a 25 basis point cut in December is priced in at 72.1% in the markets, while keeping it unchanged is priced in at 27.9%.
Despite all this uncertainty and increasing macro pressure, analysts stated that Bitcoin could rise again.
According to analysts, a sustained upward rally in BTC will depend on ETF outflows giving way to inflows and renewed confidence in risky assets.
*This is not investment advice.
Source: https://en.bitcoinsistemi.com/whats-driving-bitcoins-price-down-is-a-rise-still-possible-analysis-firm-explains/
