Yesterday, Bitcoin briefly fell below $56,000, but is now back to $58,000. Tech giant Nvidia's stock price fell sharply by nearly 10%, triggering a decline in the entire tech sector. The shock in the US stock market quickly spread to the cryptocurrency market, causing a sharp drop in the price of Bitcoin. The decline in Bitcoin prices soon spread to the entire cryptocurrency market, especially altcoins, which also saw a sharp correction in their prices. Ethereum tested the $2,300 support level. We have repeatedly discussed before that $1,900-2,300 is a good buying opportunity.
There are two main reasons behind the plunge in Nvidia and the US stock market. First, concerns related to the economic recession have resurfaced, which has intensified the negative sentiment in the market. Second, there are rumors that the US Department of Justice has filed an antitrust lawsuit against Nvidia. This lawsuit caused panic in the market, which directly led to a plunge in Nvidia's stock price. Other technology stocks were not spared and followed Nvidia's decline. However, Nvidia denied this and did not receive a subpoena.
ESAM manufacturing data in the United States shows that concerns about a recession in the United States remain. This weak economic performance has caused a large number of investors who returned to the market after the August holiday not to choose to buy, but to further confirm the weakness of the market and adopt a selling strategy, which has exacerbated the market decline.
In addition, the Bank of Japan's interest rate hike expectations are also an important factor leading to global market turmoil. The Bank of Japan once again reiterated the possibility of raising interest rates and said that if prices continue to rise and the Japanese economy improves, they will consider further interest rate hikes. This policy statement led to the appreciation of the yen, which in turn had a wide-ranging impact on global financial markets, especially exacerbating the decline of Bitcoin, the S&P 500 and the Nasdaq.
Political factors cannot be ignored either. Trump's chances of being elected are increasing, and this change in the political situation has caused market concerns about future policy directions.
