Ah, the current state of Bitcoin (BTC), a veritable rollercoaster of emotions! According to the esteemed sages at Matrixport, this correction may linger like an unwelcome guest until March or even April, before it dares to attempt a gallant rally toward its former glories. How delightful! 🎢
On the fateful day of February 27, Bitcoin plummeted below the $80,000 mark for the first time in a week, amidst a broader market sell-off that could make even the most stoic investor weep. The cause? A delightful cocktail of escalating global trade tensions, served with a twist of panic. 🍹
Meanwhile, the three major US stock market indexes joined the pity party, with the Nasdaq 100 taking a nosedive of 7.05% over the past five days, while the S&P 500 and the Dow Jones Industrial Average each fell a modest 1.33%. Oh, the humanity! 📉
“Analyzing macroeconomic trends and central bank policies gives us a clear edge in forecasting Bitcoin’s price trajectory,” Matrixport proclaimed in their February 28 research report, as if they were the oracles of Delphi. 🏛️
“This type of analysis is only becoming more crucial, especially as Wall Street investors—who track these macro factors daily—are now actively participating in Bitcoin trading.”
The US dollar: The Unexpected Hero
In this week’s financial melodrama, the US dollar has emerged as the unlikely hero, gaining strength as traders seek refuge from the storm. Who would have thought? 💪
“A stronger US dollar causes this liquidity measure to decline, which suggests downward pressure on Bitcoin prices. Global liquidity peaking in late December 2024—driven by a surging US dollar—provides a clear explanation for Bitcoin’s ongoing correction,” Matrixport sagely noted. 🧐
The US dollar index (DXY) has surged for a third consecutive day, nearing 107.40, as traders flock to the greenback like moths to a flame amid the market sell-off. This surge was spurred by none other than Donald Trump, who reaffirmed tariff hikes, imposing a 25% tariff on imports from Canada and Mexico, and an additional 10% on Chinese goods, effective March 4. What a delightful mess! 🎩
Traditional market movements have become increasingly vital for cryptocurrency traders, partly due to the success of Bitcoin ETFs in the U.S., which have seen a staggering $39 billion in inflows since their launch in January 2024. A veritable gold rush! 💰
However, 56% of these inflows are likely tied to arbitrage strategies, while the remainder of Bitcoin ETF purchases have been for long-term investments, according to the wise Markus Thielen of 10x Research. A tale as old as time! ⏳
Bitcoin Bulls: Where Art Thou?
Some Bitcoin traders, those brave souls, thrive on the concept of “buy the dip,” akin to purchasing a fine wine at a discount. 🍷
Santiment’s social sentiment tracker has found that mentions of “buying the dip” have surged to their highest level since July 2024. A true sign of the times! 📈
Charles Edwards, the founder of the digital asset fund Capriole Investment, told CryptoMoon in an earlier interview that the significant fear level and liquidations may indicate the market is nearing a short-term bottom. How poetic! 📜
Meanwhile, CryptoQuant CEO Ki Young Ju stated that the bull cycle is not over, but he’d be wrong if Bitcoin drops further below $75,000. A cliffhanger worthy of a novel! 📖
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2025-02-28 14:33