According to ChainCatcher and reported by Decrypt, Bitcoin is currently facing downward pressure in the short term due to changes in the macroeconomic environment and market sentiment. Despite breaking the historical high of $108,000 in December last year, Bitcoin is currently retracing due to the strengthening dollar, increased volatility, and cautious trader sentiment. Joe McCann, founder and CEO of Asymmetric, stated that market signals such as the Federal Reserve's hawkish news conference on December 18 and the significant rise in the volatility index (VIX) have increased the probability of short-term declines. He believes that while the outlook is bearish in the short term, the long-term outlook remains bullish.
In addition, the unexpected strengthening of the US Dollar Index (DXY) has also become a focal point. After the Federal Reserve cut interest rates by 25 basis points, the DXY broke through long-standing resistance levels, reflecting market dynamics related to global liquidity constraints and safe-haven demand. Singapore's crypto trading firm QCP Capital pointed out in a report to investors that, despite a favorable regulatory narrative supporting the spot market, the market environment at the beginning of January may be unstable, as structural risks such as the debt ceiling issue could trigger market volatility. Analysts believe that Bitcoin's trends will continue to be closely related to Federal Reserve policies and the performance of the dollar. Short-term adjustments provide investors with buying opportunities on dips, but market volatility may pose challenges for investors.
