Bitcoin has hit a new low of $86,050, linked to rising inflation expectations among US consumers and previous policies.
Causes of the Cryptocurrency Market Decline
The combination of disappointing inflation data and the ByBit incident has led to a significant downturn in cryptocurrency markets. A loss of more than 7% worsened the situation with the fear index reaching its lowest point in a long while.
Altcoin Crisis
Many altcoins are experiencing significant declines, even as Bitcoin hovered over $80,000. Futures trading liquidations skyrocketed to $1.56 billion in just one day, heavily impacting long positions and leaving 380,000 traders in the red.
Possible Scenarios for Bitcoin
The current market dynamics have pushed the RSI into oversold territory, suggesting a potential market bottom. However, Bitcoin's path to recovering $100,000 could still leave altcoin holders with losses. It is crucial for Bitcoin to stabilize above $89,200, the newly identified support level. Should it fail, further declines could signal a massive sell-off.
The future of Bitcoin and the cryptocurrency market remains uncertain amid economic changes and inflation expectations.
