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Why is crypto down today? Looking at Bitcoin, FED, and past week’s sell-off effects!
Bitcoin retained a bearish structure on the 4-hour chart. Steady selling was seen recently, but sentiment appeared to point towards a price bounce. Bitcoin [BTC] saw its Christmas rally begin to fade, and an attempt to climb past the $100k-mark was halted on Boxing Day.
The two-day U.S. Federal Reserve meeting that began on December 17 ended in a policy statement. One that forecasted just two interest rate cuts in 2025, instead of the previously projected four. This led to the Dow Jones falling by over 2.5%, or roughly 1,150 points. These losses have since been recovered, but the market has not been as kind to Bitcoin.
Risk-on asset status slows recovery
The wider crypto market generally follows the trend of Bitcoin. In the last 24 hours, BTC fell by 2.75% and the altcoin market shed 2.31% of its value.
Examining the trend of BTC on the 4-hour chart, it was found that the bearish market structure remained in place. It was flipped bearishly on December 19, marked in orange. Since then, the A/D indicator has been on a slow decline, showcasing reduced buying pressure.
The moving average formed a bearish crossover, further highlighting downward momentum over the last ten days.
Crypto is down today – Will it regain the uptrend next month?
Analysis of top trader positions on Binance using Coinglass data showed that there is some short-term hope. AMBCrypto found that this metric, which measures the long or short positions held by the top 20% of traders, was at 1.95. Long positions accounted for 66.12%, and shorts for 33.88% – a sign of bullish sentiment among the top traders.
The liquidation map further solidified this bullish short-term idea. Liquidations to the north were more numerous, implying that a liquidity hunt north is likely in the coming days.
Based on the data from the past week, AMBCrypto found that a price move might be checked at the $97.6k-mark and rebuffed by sellers. Further volatility can be expected as 2024 nears its end.
Source: ambcrypto.com
