Bitcoin continues to face challenges in surpassing the $100,000 threshold, experiencing significant selling pressure. The cryptocurrency fluctuates between $95,850 and $97,729, with a total market cap of $1.917 trillion. According to 10x Research, the crypto market is going through a tough phase, and further declines are expected.
Why Is Bitcoin Dropping?
The decline in Bitcoin is attributed to global economic and political uncertainties. Analysts at 10x Research note technical weaknesses since early February, including the formation of a 'Diamond Top' pattern, which often precedes sharp corrections. Changing market conditions and political decisions, such as new tariffs announced by U.S. President Donald Trump, have also impacted investor confidence and reduced risk appetite.
Reasons for Ethereum and Other Altcoins Dropping
Ethereum's price has dropped to $2,742, exposing market fragility. Recent price volatility has forced investors to unwind positions in the options market, triggering gamma hedging and futures contract liquidations, leading to severe price swings. Bitcoin's dominance continues to rise, sparking concerns among altcoin investors. The total altcoin market cap fell from $1.46 trillion at the end of January to $1 trillion, wiping out approximately $460 billion.
Liquidity Issues and Market Reaction
One of the major reasons behind Bitcoin’s struggle is the decline in market liquidity. Investors are cautiously monitoring interest rate decisions from the Federal Reserve and other central banks, which is hindering new purchases. This increases the likelihood that Bitcoin will struggle to breach the $100,000 mark, raising the probability of further losses.
Ongoing weaknesses in Bitcoin's technical indicators and an unstable economic environment keep short-term downside risks elevated. Investors and analysts closely observe the shifts to adapt to the dynamics of the crypto market.
