The prices of Bitcoin, ETH, SOL, XRP, DOGE have fallen in the past 24 hours due to a variety of reasons including the assassination of Donald Trump.
The cryptocurrency market plunged on Monday, with cryptocurrency investors losing $80 billion and the market value shrinking from $2.1 trillion to $2.03 trillion. On Sunday, Republican presidential candidate Donald Trump was assassinated again at his Florida golf club, and the prices of Bitcoin and Ethereum suddenly fell.
Additionally, the crypto market Fear & Greed Index slipped from 51 (Neutral) to 39 (Fear) in one day. Altcoins such as Solana (SOL), XRP, Cardano (ADA), and Dogecoin (DOGE) also fell, mirroring the declines seen by Bitcoin and Ethereum. However, traders were generally optimistic as they focused on the FOMC meeting and Jerome Powell’s decision on Wednesday.
Why is the price of Bitcoin falling?
Bitcoin prices fell this week as traders were cautious ahead of the Federal Reserve’s much-anticipated policy change, with the market expecting the Fed to cut interest rates for the first time since 2020, with speculation that the rate cut would be as much as 50 basis points.
According to the CME FedWatch tool, there is a 61% chance of a 50 basis point rate cut after the FOMC meeting, and a 39% chance of a 25 basis point rate cut. In addition, data shows that the Fed has cut interest rates by a total of 125 basis points this year.
PlanB, creator of the Bitcoin Stock-to-Flow (S2F) model, shared a chart of Bitcoin miner revenue on X. He warned that miners are still struggling after the Bitcoin halving and gradually liquidating their holdings. He said: "We need 2x the current BTC price to start a bull run." This is in line with historical patterns that BTC prices have maintained miner profitability after halvings.
Cryptocurrency analyst Credible Crypto noted that BTC price has perfectly retreated from the ideal $61-62K resistance zone. However, the price is currently holding above $58,500, which is crucial to prevent further declines.
Coinglass data shows that BTC liquidations approached $35 million, of which $30 million of longs were liquidated. When the price fell below the 50-SMA (blue), traders sold BTC, causing the price of Bitcoin to fall to a 24-hour low of $58,112.
Moreover, the price has successfully reversed from the 0.618 Fibonacci retracement level to the 0.5 Fibonacci retracement level on the daily chart. The price is expected to trade sideways around $59,000 ahead of the FOMC meeting. A 50 basis point rate cut will boost sentiment, but price momentum will remain volatile.
Why did the Ethereum price fall below $2,300?
As ETH/BTC fell to a 3-year low, the "Diamond Hand" Ethereum whale, which had been silent for eight years, became active and sold its ETH holdings. Bitcoin's dominance rose to 57.68% for the first time since April 2019. In addition, other whales also turned bearish after the Ethereum Foundation and Vitalik Buterin recently sold ETH. Today, the largest single liquidation order occurred on OKX as someone exchanged ETH for $2 million worth of USD.
Ali Martinez, a well-known analyst, pointed out that if the ETH price fails to hold the key support level between $2,290 and $2,360, there is a risk of further decline. It is worth noting that 1.9 million addresses hold about 52 million ETH in this range. He added that falling below this demand range could lead to a wave of selling, pushing the price down to $1,800.
ETH price has dropped 6% in the past 24 hours and is currently trading at $2,308. The 24-hour low and high prices were $0.643 and $0.664 respectively.
The decline in Bitcoin and Ethereum prices triggered a drop in other altcoins such as SOL, XRP, DOGE, and ADA. The market will focus entirely on the FOMC meeting for further directional clues.
