On Tuesday, Bitcoin (BTC) dropped below $100,000 due to a substantial market downturn, influenced by stronger-than-expected economic data that might postpone Federal Reserve interest rate reductions. BTC had been trading above $100,000 since January 6, reaching an intraday peak of $102,464. However, the drop caused its value to fall below $100,000 to its current level of $96,278. Over the past day, the price has decreased by nearly 6%, with sellers holding the upper hand.
In simpler terms, the overall crypto market didn’t fare well either. For instance, Ethereum dropped more than 9%, falling below $3,500. Solana also dipped under $200 after a similar decrease of over 9%, currently hovering around $197. Dogecoin plunged nearly 10% and reached $0.352. Similarly, Ripple, Cardano, Tron, Chainlink, Toncoin, Stellar, Hedera, Polkadot, Litecoin, Uniswap, and numerous other altcoins experienced significant losses.
Bitcoin (BTC) Plummets Below $97,000
As a researcher, I observed a significant drop in the value of Bitcoin (BTC) on Tuesday, dipping below the $100,000 mark. This decline was prompted by stronger-than-anticipated economic indicators that put strain on riskier assets such as cryptocurrencies. According to data from Coin Metrics, BTC plummeted to a low of $96,525, representing a 5% decrease. The crypto stock market also experienced substantial drops with companies like MicroStrategy, Mara Holdings, Core Scientific, and Coinbase feeling the brunt.
This fall follows a sudden rise in the 10-year US Treasury Yield, which was triggered by data released by the Institute for Supply Management indicating faster-than-expected growth in the US service sector. This development has heightened concerns about inflation, further exacerbating the downward pressure on Bitcoin and other cryptocurrencies.
As an analyst, I’m sharing my perspective on the current state of Bitcoin (BTC) and the broader cryptocurrency market. Market participants anticipate BTC could surge to $200,000 this year, bolstered by optimism about a more defined regulatory landscape that should boost digital asset prices and positively affect crypto stocks. Nonetheless, there’s apprehension regarding potential interest rate adjustments by the Federal Reserve, which might negatively impact crypto market values if they decide to make fewer cuts in 2025. This shift in Fed policy has caused ripples of uncertainty throughout the financial markets.
A Surge In Liquidations
A sudden drop in Bitcoin’s price below $100,000 led to a spike in cryptocurrency market liquidations. Coinglass data revealed that around $200 million worth of long positions were liquidated within an hour, with this figure rising to $483 million over the following 24 hours. Similarly, Ethereum and Solana also experienced significant drops, causing ETH to fall below $3,500 and SOL to dip under $200. Despite these drops not being as severe as those seen in December/January, they still had a substantial impact, with approximately 129,900 traders experiencing liquidation over the last 24 hours. The largest liquidation was recorded on Binance, with nearly $12 million worth of positions being terminated.
US CFTC Chair To Step Down
Rostin Behnam, head of the Commodity Futures Trading Commission (CFTC), is set to leave his position on January 20, marking the conclusion of a four-year term during which he took strong enforcement actions in the cryptocurrency sector and advocated for stricter regulations. Under his leadership, several high-profile cases were handled, such as the $4.3 billion settlement with Binance. Yet, Behnam voiced worries about the absence of supervision in the digital assets domain, stating that existing rules are not enough.
Under Behnam’s leadership, the Commodity Futures Trading Commission (CFTC) established federal guidelines for carbon offset trading and broadened its supervision over digital assets. He also took action against Binance for illegally operating in the U.S., functioning as an unlicensed cryptocurrency derivatives platform that disregarded regulations. Furthermore, he pointed out regulatory loopholes in the crypto markets, stating that many tokens can be classified as commodities and should fall under CFTC’s jurisdiction. He urged his successor to bring a renewed focus for improved clarity.
Currently, Brian Quintenz, who was a commissioner at the Commodity Futures Trading Commission (CFTC) before taking on the role of head of policy at Andreessen Horowitz’s cryptocurrency division, is being considered as the leading candidate to take over Behnam’s position.
Bitcoin (BTC) Price Analysis
As a researcher observing the Bitcoin market, I’ve noticed a dramatic dip below $100,000 on Tuesday, following a 5% drop as markets showed signs of bearish sentiment after stronger-than-expected economic indicators put immense pressure on risk assets. The digital currency plunged to a low of $96,202 before slightly rebounding to $97,019.
Notably, Katie Stockton, a prominent technical analyst at Fairland Strategies, has cautioned investors about a potential double-digit drop in Bitcoin prices. She believes the current bull run has overinflated the asset, and it may find support around $84,000, indicating a possible 13% decline. If the selloff intensifies, a secondary support at approximately $73,800 could come into play.
Stockton told clients in a message that she expects short-term instability even though Bitcoin has regained the $100,000 threshold, predicting it might drop as low as $90,000 before finding stability around $84,000. However, Stockton continues to be optimistic about Bitcoin’s future outlook, citing a robust long-term environment that could bolster the asset.
The Bitcoin recovery seems strong at the moment, but it’s likely to diminish swiftly, resulting in a lower peak compared to its December high. The weekly Stochastic Oscillator is showing signs of active overbought conditions and the daily Stochastic Oscillator has just entered overbought territory. This suggests that any further price increase will be limited for now.
Bitcoin saw a bullish trend even though it dipped to a low of $91,279 on Monday. It bounced back from this point on Tuesday and peaked at an intraday high of $496,159. However, the upward momentum waned after reaching that level, causing Bitcoin to close at $93,383, marking a nearly 1% increase. The price climbed higher on Wednesday, rising by 1.06% to reach $94,373. On Thursday, bullish sentiment grew significantly as Bitcoin rose almost 3% and surpassed $95,000, ending the day at $496,823. The price moved above its 20 and 50-day Simple Moving Averages (SMAs) on Friday after a 1.09% increase, settling at $97,878.
Over the weekend, buyers maintained their grip on Bitcoin’s price as it experienced a slight uptick, ending at $98,312 on Sunday. The bullish trend grew significantly on Monday when Bitcoin surpassed $100,000, settling at $102,228. However, bearish sentiments resurfaced on Tuesday due to stronger-than-expected economic data that affected risk assets. As a consequence, Bitcoin fell by more than 5%, dipping below $100,000 and the 50-day moving average, settling at $97,019. Currently, the market is seeing a slight decline in Bitcoin as sellers try to push it under the 20-day moving average. If sellers maintain control and bearish sentiment continues, Bitcoin might drop to $90,000. Should Stockton’s prediction prove accurate, Bitcoin could fall below $90,000.
Ethereum (ETH) Price Analysis
Currently, Ethereum (ETH) is finding it tough to stay above the $3,300 mark due to a bearish trend in the market that’s causing prices to drop. On Tuesday, ETH fell below the significant $3,500 level after a 8% decrease, dipping below key moving averages. Despite experiencing high volatility and only a slight growth on Monday, Ethereum had been quite optimistic the previous week. A push towards $3,500 was attempted by buyers on Tuesday as ETH reached an intraday high of $3,448, but sellers managed to drive the price back down nearly 1% to $3,333. However, there was a slight shift in sentiment on Wednesday, with ETH increasing by 0.69% and closing at $3,356. Buyers maintained control on Thursday as Ethereum rose almost 3% and ended the day at $3,452.
On Friday, there was a significant boost in optimistic expectations towards Ethereum (ETH) as it surpassed both its 20 and 50-day moving averages, reaching a closing price of $3,607 or approximately $3,500. The trend continued on Saturday with ETH increasing by 1.37%, hitting $3,657. However, the resistance at $3,700 took effect, causing a minor dip of 0.615% to close at $3,634 on Sunday. On Monday, buyers made an effort to exceed $3,700, pushing ETH up to an intraday high of $3,744. Yet, after reaching this level, the momentum waned, and ETH ended the day at $3,687. The markets started showing signs of pessimism on Tuesday, causing ETH to plunge over 8%, dropping below its 20 and 50-day moving averages as well as the critical $3,500 mark to reach $3,381. As of now, ETH is in a downtrend during the current session, with the price dipping nearly 2% as sellers aim to push it below $3,300.
Solana (SOL) Price Analysis
In simpler terms, Solana (SOL) has seen a considerable decline in the last two trading sessions due to bearish market conditions following the publication of economic reports. Previously, SOL experienced high volatility throughout the week as both buyers and sellers fought for dominance. However, eventually, buyers managed to gain control, causing the price to rise by 0.72% to $191 on Monday. Solana climbed to a daily high of $199 on Tuesday as buyers tried to push it above $200, but they ran out of steam at that point, allowing sellers to regain control and push SOL down to $189. Buyers returned on Wednesday, causing SOL to rise by nearly 3% to $194. The bullish sentiment grew strongly on Thursday as Solana surpassed its 20-day moving average and the $200 mark, closing at $208.
On Friday, SOL experienced a nearly 5% growth, peaking at $217 due to aggressive buying aimed at $220. However, sellers stepped in on Saturday, causing a slight dip to $216 as SOL lost momentum. On Sunday, sellers maintained control, leading to a 1.52% decline that left SOL closing the weekend below its mark at $213. The following Monday saw SOL reach an intraday high of $223, but it failed to sustain this level and eventually fell to $218, resulting in a 2.30% increase. On Tuesday, markets turned bearish, causing SOL to plummet by 7% and settle at $202. As we speak, SOL is trading below $200 and its 20-day Simple Moving Average (SMA), with a current drop of over 4%, hovering around $193.
Injective (INJ) Price Analysis
Last week, I found myself quite optimistic about INJ, with its price trending bullishly. However, on Tuesday, it experienced a substantial downturn when it failed to surpass the 50-day Simple Moving Average (SMA). This decline took the price down to $19.49 at its lowest point on Tuesday. Interestingly, INJ demonstrated remarkable resilience on Wednesday, recording a nearly 5% increase and climbing up to $20.52. The bullish momentum continued on Thursday, with an additional 5.76% rise, pushing the price to $21.70.
The optimism surrounding INJ intensified even further on Friday. It managed to surpass not only the 20-day SMA but also the 200-day SMA after recording an increase of over 6%, settling at a high of $23.03. This bullish trend suggests that INJ may continue its upward trajectory in the coming days.
On Saturday, buyers maintained dominance as INJ climbed by 2.41%, reaching $23.59. On Sunday, sellers tried to take over but the price dipped to an intraday low of $22.68 before recovering to end the day with a 7.65% gain, closing at $25.39. Monday saw intense competition between buyers and sellers looking for control, but ultimately it was the buyers who prevailed, pushing INJ up by over 2%, ending the day at $25.91. However, pessimism resurfaced on Tuesday as the price fell by more than 8% to close at $23.80. As of now, sellers are in control, with INJ down nearly 5% and currently trading at $22.72.
On Saturday, buyers controlled the market as INJ rose. On Sunday, sellers tried but INJ recovered to rise again. There was a lot of back-and-forth on Monday, but ultimately buyers won out. However, negative feelings returned on Tuesday and INJ dropped sharply. Now, sellers are controlling the market.
Dogwifhat (WIF) Price Analysis
Since the weekend, Dogwifhat (WIF) has been experiencing downturns after it couldn’t push past its 200-day Simple Moving Average on Saturday. WIF had maintained a tight price range since December 20th, reaching an intraday low of $1.72. Towards the end of last week, it broke out of this range, showing a significant rise of nearly 9% on Thursday, pushing its value above $2 to $2.02. Buyers continued their control on Friday as WIF surged over 7%, moving past its 20-day SMA and closing at $2.16. However, the bullish sentiment weakened on Saturday, with the 200-day SMA acting as a resistance level that limited WIF’s advancement, allowing it to only record a minimal increase and close at $2.17.
On Sunday, with buyers slowing down, sellers seized the opportunity, causing WIF to decrease by 3.51%, reaching $2.10. WIF saw a minimal dip on Monday, dropping to $2.08. However, pessimistic feelings about WIF significantly increased on Tuesday as the price fell below its 20-day moving average, decreasing more than 11% to $1.85. During this current session, sellers are aiming to push the price of WIF even lower.
Chainlink (LINK) Price Analysis
On Monday, December 30, Chainlink (LINK) dipped beneath its 50-day Simple Moving Average (SMA), shedding nearly 2% to reach $20.57. The following day, sellers held the upper hand, causing LINK’s price to plummet below the $20 support and close at $19.99. However, on Wednesday, LINK managed to bounce back from that level, gaining 8.55% to recapture the $20 mark and surpass its 50-day SMA, ending the day at $21.70. On Thursday, buyers took charge as LINK climbed by 1.64%, finishing the session at $22.05. Finally, on Friday, LINK saw a rise of 6.39% and touched $23.46.
On Saturday, I observed significant fluctuations in the price of LINK as it registered a minimal rise and closed at $23.59. There was a marginal dip on Sunday, with the price dropping to $23.56 before the weekend concluded in the negative. On Monday, buyers made an effort to push LINK above $25, taking it to an intraday high of $24.76. However, their momentum waned upon reaching this level, resulting in LINK closing at $23.83. The market exhibited bearish sentiment on Tuesday as LINK plummeted by more than 10%, slipping beneath the 20 and 50-day Simple Moving Averages and settling at $21.38. Currently, sellers seem to be in control, with LINK down over 2% and trading around $20.89.
Uniswap (UNI) Price Analysis
As an analyst, I observed that Uniswap (UNI) encountered resistance around the $15.50 mark last week, causing a temporary halt in its upward momentum. This pause allowed sellers to regain control and drive the price down below $15.
Prior to this, UNI had been quite bullish, surging nearly 3% on Wednesday and crossing the 50-day Simple Moving Average (SMA) to settle at $13.62. The bullish sentiment grew even stronger on Thursday, as UNI climbed another 5.52%, surpassing the 20-day SMA and ending the day at $14.37. Buyers maintained control throughout Friday, propelling UNI up by almost 6% to reach $15.18.
On Saturday, sellers made an attempt to push UNI back towards the 20-day SMA, as the price dipped to an intraday low of $14.76. However, UNI managed to recover slightly and closed the day at $15.28.
On Sunday, the Uniswap token (UNI) experienced a decline of 0.79%, closing at $15.16 after initially showing strength at approximately $15.50. The start of this week saw sellers maintaining control, causing UNI to dip slightly to $15.08. However, the selling pressure significantly increased on Wednesday, with UNI falling over 10% and dipping below both its 20-day and 50-day moving averages as well as $15, settling at $13.54. Currently, sellers are aiming to drive UNI prices below $13, with a further drop of 1.30% observed, leaving the token trading around $13.26 in the current session.
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2025-01-08 13:11