Bitcoin
Why Bitcoin Price Is Falling Drastically Today
The price of Bitcoin (BTC) has fallen sharply in the last hour, falling below the $70,000 support level. The sharp decline may be linked to several factors, including robust U.S. employment data and a decline in GameStop
share price, which had a negative impact on the mood of the cryptocurrency market.
This dramatic drop led to the liquidation of over $300 million from the cryptocurrency market in the last hour.
Bitcoin Price Market Indicators
Consequently, the current crisis can be seen in Bitcoins market indicators. The Bitcoin Dominance metric, which indicates the percentage of the cryptocurrency’s total market capitalization that belongs to Bitcoin, increased by 1.04% to 53.69%. This indicates that even though Bitcoin is experiencing a pullback, it is still performing much better than the rest of the cryptocurrencies.
Additionally, Bitcoin’s foreign exchange reserve fell 0.06% to 1.81 million, suggesting that investors may be withdrawing Bitcoin to personal wallets to hold and not sell on exchanges.
The Crypto Fear & Greed Index, which shows market sentiment, decreased by 1.28% to 77, meaning market sentiment is still in the ‘Greed’ territory. However, extreme greed is usually the last phase of a bull market and is evident in the current situation.
Source: Coinglass
Additionally, CME BTC futures open interest fell 2.19% to $11.12 billion, indicating that traders are closing their positions, which could be due to less confidence in the market or a period consolidation following recent volatile price action.
Strong US employment data
The recent Employment in the USA The status report also put negative pressure on the price of Bitcoin as it revealed that 272,000 jobs were added in May, far above the 185,000 jobs expected.
Consequently, higher employment numbers decreased the likelihood of an interest rate cut by the Federal Reserve in the near future, which led to a rise in interest rates and the US dollar.
This change in the economic scenario has put negative pressure on risky assets, including cryptocurrencies.
GameStop Stock and Crypto Market Sentiment
At the same time, a significant drop in GameStop Stock (GME) also negatively affected sentiment in the cryptocurrency market. According to Coingape the situation was precipitated by Roaring Kitty, a trader who has a large following on social media platforms, through a live session on YouTube.
As expected, Roaring Kitty didn’t have much to say and this left investors quite disappointed. GameStop shares fell 40% during the session, and meme coin GME fell 50%. This type of downtrend also affected other meme cryptocurrencies such as DOGE where the price fell by 8%, SHIB which fell by 10% and PEPE by 15%.
Despite the recent liquidation, spot Bitcoin ETFs are on their longest accumulation streak since their release. Over an 18-day streak, these ETFs accumulated more than 56,000 Bitcoins, nearly seven times the amount mined during that period. However, this was insufficient to sustain a recovery in the price of Bitcoin.
Source: CoinMarketCap
At press time, Bitcoin price was trading at $69,000, down 2.5% in the last 24 hours. At the same time, BTC’s market capitalization decreased by 2.52% to $1,362,313,410,346, while the 24-hour trading volume increased by 48% to $36,296,396,359.
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