The crypto market has had a sharp decline today, with Bitcoin leading the downturn. Per CoinMarketCap, the global crypto market cap has dropped to $2.04T, a 2.84% dip in the last day.
Moreover, BTC trades at $58,578.25, having seen a 2.39% drop in value within the same time. Other major crypto assets have also seen declines, with Ethereum and other altcoins displaying similar negative trends.
A snapshot from Crypto Bubbles shows a market filled with red tokens, highlighting the broad-based nature of this dip.
Source: CryptoBubbles Ethereum Foundation Sells 100 ETH
One of the elements driving down the market is the ongoing selloff of the Ethereum Foundation. Based on analytics platform Spotonchain’s data, the foundation traded DAI stablecoins for 100 ETH valued at $227k.
The Ethereum Foundation sold Ethereum this third week in succession, bringing the total to 650 ETH, valued at roughly $1.51 million.
Although the numbers sold could be higher, the regularity of these transactions raises questions about the long-term plan of the foundation. The average price of Ethereum Foundation’s selling was $2,323 per ETH.
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Show more +Show less – Bitcoin Price Faces Pressure
Bitcoin is also facing technical challenges, as noted by market analyst Ali (@ali_charts). On the hourly chart, Bitcoin is trading within a parallel channel.
According to Ali, if the lower boundary holds, Bitcoin could potentially rebound to $60,200 or even $62,000. However, a break below the key support level at $58,100 may trigger further downside, with a potential drop towards $55,000.
On the hourly chart, #Bitcoin is moving within a parallel channel. If the lower boundary holds, $BTC could rebound to the mid or upper levels at $60,200 or $62,000. However, a break below the $58,100 support may lead to a drop towards $55,000. pic.twitter.com/5JbnrGRjYE
— Ali (@ali_charts) September 16, 2024
These technical factors have added further pressure to Bitcoin’s price movement, complicating the short-term outlook for traders and investors.
Federal Reserve Rate Cuts Add Volatility
The market’s shifts is a result of expectations surrounding the Fed’s upcoming interest rate announcement. Mark Cullen of AlphaBTC warns that if the Fed announces a surprise 50 basis point drop, there may be instant market turmoil.
Cullen claims that astute traders may take profits before the announcement, which would cause a momentary decline in the price of Bitcoin. Cullen also believes that after the rate decrease, Federal Reserve Chair Jerome Powell would make a dovish speech that would soothe the markets.
Its going to be a choppy week for #Bitcoin.I'm thinking there will be a surprise 50bp cut which will initially spook the market with smart longs taking profit and we get a bit of a pull back. Then JP will come with a dovish conference speech and markets will see it as a… https://t.co/XZDzcz5nxM pic.twitter.com/8FlTHvXqPS
— AlphaBTC (@mark_cullen) September 16, 2024
The possibility of an impending recession still exists, though, and this could have an impact on market mood in the upcoming weeks. This is particularly when corporate earnings reports for October are made public.
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