Bitcoin's price experienced a significant drop in the past 24 hours, plunging below $57,000. Overnight, the cryptocurrency reached a low of $55,600, then recovered slightly to $56,628. Ethereum also saw a substantial decline, losing 6.4% of its value and trading at $2,366. Analysts attribute these movements to weak economic indicators from the US and selling pressure in Asian markets.
What Caused the Recent Declines?
The cryptocurrency market faced a major downturn, with Bitcoin plummeting 4.5% to $56,696. Similarly, Ethereum dropped by 6.4% to $2,366. Experts point to poor economic data from the US and heavy sell-offs in Asian markets as the primary reasons for these declines. Peter Chung, Research Director at Presto, highlighted that weak ISM data for August from the US ignited a sell-off in financial markets, adversely affecting Bitcoin.
How Did Traditional Markets Perform?
Traditional financial markets also experienced sharp declines. Japan’s TOPIX index fell by 2.7% in the morning, and South Korea’s KOSPI index dropped 2.46%. In the US, tech giants like Nvidia saw a 9.5% decrease in value. The 24/7 trading nature of the cryptocurrency market makes it especially vulnerable to such volatility.
Key Data to Watch
Markets are now focused on the upcoming US non-farm payroll data set to be released on Friday. This data will be crucial in shaping expectations for the Federal Reserve’s interest rates. Augustine Fan from SOFA.org mentioned that September will be a busy month, and the data will confirm the extent of the economic slowdown.
Market research indicates that US data will play a crucial role in the near future. Investors should monitor economic indicators from both the US and Asia to better assess market conditions.
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