Hello everyone, I'm Penny.
BTC is also facing increasing pressure due to strong US economic data, and retail sentiment has been hit. Currently, Bitcoin's 24-hour low is $96,132 and the high is $102,022. The trading volume has also fallen by 23%, reflecting cautious market activity.
Major altcoins also fell across the board, falling 5% to 10% in 24 hours. Even memes felt the pressure, with Dogecoin (DOGE) falling 8% and Shiba Inu (SHIB) falling 10%.
The global cryptocurrency market is down 16% and now stands at $3.38 trillion.
In a downward trend, Bitcoin ETFs are gaining traction.
Despite Bitcoin's poor performance, BlackRock's iShares Bitcoin ETF (IBIT) still recorded a massive inflow of $597 million. This marks the third consecutive net inflow for spot Bitcoin ETFs, indicating that even with macroeconomic pressures, institutional confidence remains strong.
Institutional inflows highlight market optimism.
On January 7, nearly $978 million flowed into Bitcoin spot ETFs, led by BlackRock. It is reported that today BlackRock's IBIT purchased 6,078 BTC, worth $208.7 million, far exceeding the BTC mined that day.
Other ETFs struggle during sell-offs
Although BlackRock continues to dominate, other Bitcoin ETFs are facing significant outflows. Fidelity's FBTC, Bitwise's BITB, and Ark Invest's ARKB collectively saw outflows exceeding $400 million. Grayscale's GBTC also recorded an outflow of $125.45 million, further highlighting BlackRock's comparative strength in the market.
Will BTC continue to drop?
Currently, the probability of the Federal Reserve maintaining interest rates in January is 95.2%. Additionally, there are non-farm payrolls and unemployment data being released this week. If the conditions favor multiple rate cuts, the market will rise; if not, the market will fall.
BTC has become more stock-like and needs more policy stimulus. Therefore, waiting until January 20, the day of power transition when Trump takes office, we can still remain optimistic about the subsequent market. However, before that, the market is bound to be challenging. So everyone should be cautious and calm, as it is easy to face both long and short squeezes.
What is dragging Bitcoin down?
The cryptocurrency market is feeling the pressure from strong U.S. economic data. More employment opportunities and better-than-expected service sector data are strengthening the dollar, which is not good news for Bitcoin. Additionally, higher U.S. Treasury yields make traditional investments more attractive, diverting attention away from cryptocurrencies.
Currently, the U.S. dollar index (DXY) remains strong above 108.50, while the 10-year U.S. Treasury yield has reached a 35-week high of 4.68%, exacerbating Bitcoin's downward trend.
Hope brought by institutional support.
BlackRock is actively buying Bitcoin even during market downturns, indicating its unwavering confidence in the long-term potential of digital assets. The iShares Bitcoin ETF continues to attract substantial inflows, which may lay the groundwork for renewed optimism in the cryptocurrency sector, especially as investors face macroeconomic challenges.
Currently, everyone's attention is focused on institutional participants and economic trends to observe the next steps for Bitcoin. With continued support from BlackRock and Fidelity, we have reason to believe that the cryptocurrency market will shine again after Trump takes office on January 20!
2025 Spot Trading Recommendations
Everyone should not have the idea of making 10 times on a single cryptocurrency with secondary listings. Looking back, even if there were tenfold increases, those who haven't opened their 'heavenly eye' wouldn't dare to heavily invest, and if they did, they couldn't hold on! Moreover, this will affect our profits in every upward trend, leading to complete withdrawals or even losses.
So after Trump takes office, the market will rise again, and everyone must sell in batches! Especially during a market rise, people's psychology is driven by greed and panic. Greed makes people want to hold on for more profits, to reach higher. Panic comes from fearing they have too little position or are not on the bandwagon, missing out on opportunities.
Those holding long positions should not be too heavily invested; never go all in, and use some funds for sporadic trading. Times have changed, and we should not cling to outdated strategies. If we do not grow, we risk suffering severe losses. Adapting to market changes is crucial for becoming stronger.
As long as we do not operate blindly, there are still many opportunities in the cryptocurrency market, so protecting the principal is crucial. Adding to positions in a rising market is a major taboo, especially when the market has been rising for about a week; the risk of loss when adding to positions can exceed 85%.
We need to cultivate good trading habits, not be misled by our own greed or the noise from the outside. We should try to summarize the underlying logic and patterns.
I am Penny, a long-term cryptocurrency holder. I don't deal with contracts or leverage. I earn coins in a bear market and earn USDT in a bull market. If you are also this kind of person, then welcome to follow me!
Let's navigate through the bull and bear markets together, banding together for warmth, and strive to be a resilient participant.