Fed, Declining Flows, and Pressures on Bitcoin
The post Fed, Declining Flows, and Pressures on Bitcoin appeared on BitcoinEthereumNews.com.
The cryptocurrency market is currently in a phase of significant uncertainty, heavily influenced by expectations regarding interest rates and statements from members of the Federal Reserve. The words of the New York Fed President, John Williams, have recently shifted investor sentiment, significantly increasing the likelihood of a rate cut as early as December. This hypothesis, until a few days ago, had been almost completely ruled out by market forecasts, but now it is once again becoming a central element in traders’ strategies. Bitcoin Under Pressure: Volatility and Reduced Liquidity In recent days, Bitcoin has experienced a phase of heightened volatility, temporarily dropping below the $85,000 threshold. This movement occurs in a context of still reduced liquidity, which amplifies the market’s sensitivity to macroeconomic news. Many traders interpret the recent rebounds as a possible dead cat bounce, meaning a temporary recovery likely to quickly fizzle out, indicating that the bearish trend may not yet be over. On Monday morning, Bitcoin continued to show signs of weakness. Funding rates remained negative on several trading platforms, indicating that bearish pressure is still strong. Even BitMEX, one of the platforms historically slower to react to market changes, highlighted a markedly bearish tone over the weekend. The positioning of traders suggests that many are bracing for a possible further decline in prices. On-chain Data: Investor Losses on the Rise The analysis of on-chain data confirms the delicate moment the market is experiencing. The proportion of investors in a loss is steadily increasing: while during the recent highs almost 100% of participants were in positive territory, now this percentage has dropped to around 60%. This data highlights how the correction phase has severely impacted a significant portion of the market. The realized losses in dollars have reached new records, indicating a phase of forced liquidations and…
