đš Why is BITCOIN DOWN? 3 Reasons!
Bitcoinâs price is down today, primarily influenced by economic concerns and upcoming U.S. jobs data. As of Sept. 4, BTC has dropped by 3.3%, trading at around $55,600, marking its lowest point in a month. The decline mirrors broader risk asset sell-offs, such as the S&P 500, due to increasing fears of a recession.
1. Recession Fears Hit Bitcoin and Stocks
The drop comes as traders prepare for key U.S. jobs data, which is expected to slow down the labor market. This follows other indicators like declining manufacturing activity, raising concerns about economic growth rather than inflation. A cooling jobs market is heightening market jitters, leading to large outflows from Bitcoin ETFsâ$287.80 million in daily outflows, the longest streak since June.
2. Bitcoin Futures Market Signals Caution
Open interest (OI) in Bitcoin futures has fallen from $37.5 billion in July to $30 billion as of Sept. 4, signaling reduced confidence among traders. Funding rates have also dropped, indicating less demand for leveraged long positions as traders de-risk ahead of economic data.
3. Technical Breakdown in Progress
Technically, Bitcoin is breaking down from a "rising wedge" pattern, which typically signals further declines. If the current trend continues, BTC could fall to around $54,000 in the near term. However, a bounce from the $56,300 support level could push the price up to $59,000, invalidating the bearish setup.
In summary, Bitcoinâs recent price action reflects broader market caution around the U.S. economic outlook and concerns about the Fed's next moves, making it a volatile time for crypto traders.
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