Bitcoin’s bearishness extends to cryptocurrencies and stocks
Massive selloffs fuel bitcoin’s downtrend
Investors and traders are cautious amid economic uncertainty
Bitcoin’s bearish outlook has extended to cryptocurrencies and stocks. Shares of Coinbase and MicroStrategy tumbled over 4%, while crypto mining firms Marathon Digital and Riot Platforms lost over 2%. But why is BTC bearish?
Bitcoin’s recent slump can be attributed to a surge in forced sales, known as long liquidations. Traders find themselves compelled to offload their holdings at the prevailing market rate to cover their financial obligations.
Massive Selloffs Fuel Bitcoin’s Downtrend
Bitcoin long liquidations hit $56 million in the last day alone, exerting downward pressure on its value. The same pattern repeated last Thursday with $56 million in long liquidations.
Cryptocurrency enthusiasts share the stock market’s concern over the Federal Reserve’s hesitance to lower interest rates this year. With the Fed’s two-day policy meeting underway and a decision anticipated by Wednesday, this unease has rippled through the traditional markets.
Just a tip for the new fellas out there.If you want to sell, you don't panicly sell the bottom of the dip.If the support is lost, you sell the retest.Even if the downtrend is confirmed, markets will always offer a retest first.#BTC pic.twitter.com/ZLE30q0FHW
— 𝐋𝐨𝐧𝐠𝐓𝐞𝐫𝐦® (@LongtermR) June 11, 2024
Bitcoin is bearish and about to breach the 20-SMA on the weekly chart. According to the X post above, a crypto analyst, traders should avoid panic selling. He also suggested that selling the retest could work if support is lost.
Market Cautiousness Amidst Economic Uncertainty
The crypto market’s recent retraction is also linked to investor caution in light of impending economic announcements. Analysts point out that the general trading community is treading carefully in anticipation of the Consumer Price Index (CPI) report for May and the upcoming Federal Reserve meeting.
The focus is particularly sharp on the Federal Open Market Committee (FOMC) members’ projections for interest rates, often referred to as the ‘dot plot’.
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