Looking at the latest news on$BTC Bitcoin, the cryptocurrency is officially on its third day of massive selloff since the price crash. At press time, it was down 13% from its current ATH.
The key question now is what are the reasons for this retracement and how far it can fall. Bitcoin was trading at $94,510 at the time of observation, meaning it has lost more than $13,000 in just three days.
In other words, some $270 billion has been wiped out of the market since its recent peak on Tuesday.
This sharp price drop is a sign of massive panic in the market. More importantly, this outcome came after the last FOMC meeting where Jerome Powell revealed that the Fed would not buy Bitcoin.
Additionally, Powell revealed that only 2 rate cuts will occur in 2025. These statements fueled a bearish outcome and it started as profit taking but turned into an avalanche of selling pressure.
Source : X
Traditionally, rate cuts pave the way for a larger injection of liquidity due to easier access. However, inflation still seems high and could be the reason why the market reacted with a bearish outcome.
Bitcoin News: Liquidations Rise as Leverage Reduces
Additionally, the selling pressure triggered an increase in liquidations, leading to a reduction in leverage. Approximately $409.42 billion in long liquidations took place over the past three days.
Bitcoin Liquidations / source: Coinglass
In contrast, the total short liquidations over the same period amounted to $109.26. But will the downtrend continue over the weekend?
Heavy profit-taking was inevitable and is one of the main reasons for the rapid decline in the latest wave of selling pressure. But how far can this selling pressure go?
The Fibonacci retracement from the start to the end of its Q4 bullish wave suggests accumulation could return between $73,907 and $80,500.
BTC price evolution / source: TradingView
The Fibonacci retracement indicates that selling pressure could continue into the weekend. However, this depends on whether demand can stay in check long enough for the bears to push into this range.
Many investors may consider prices below $100,000 to be declining. However, some anticipate prices to decline into the aforementioned range.
This includes former Binance CEO CZ, who revealed in a recent tweet that he predicts a drop to $80,000.
Source : X
Cathie Wood maintains a very optimistic long-term position
Savvy investors like Ark Invest CEO Cathie Wood remain optimistic about BTC's long-term prospects despite the Bitcoin news and developments being reported.
She predicted earlier this year that Bitcoin could surpass $1 million by 2030 and is maintaining her stance according to a recent Bloomberg interview.
Woods predicted that Bitcoin could increase 10x from its current levels. His 2030 price target is between $1 million and $1.5 million.
She revealed in the Bloomberg interview that she expects an influx of institutional cash over the next five years.
Woods backed up his prediction by pointing out that pro-crypto regulations would encourage greater institutional participation.
Additionally, Woods pointed out that the Bitcoin halving in 2024 has made BTC scarcer than gold in terms of annual supply. This makes it attractive as a scarce digital asset.
Bitcoin News: Reasons for the Freefall and Why Cathie Wood is Staying
