Bitcoin has been the victim of recent extreme volatility in the market. Bitcoin has fallen after briefly reaching the $70,000 mark, despite the fact that the market was bullish.
Bitcoin’s price has hit new lows due to the economic situation and the increasing geopolitical tensions.
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Bitcoin is falling for Three reasons
![Bitcoin BTC Crash](https://fxruhanahmed.com/2/wp-content/uploads/2024/04/3-Reasons-Why-BTC-Is-Falling-in-a-Bullish-Market.jpg)
Geopolitical Storm (Israel-Iran War)
Bitcoin has been falling due to increasing geopolitical tensions involving Israel and Iran. Bitcoin’s price has not yet reached a level of stability despite the fact that investors have embraced Bitcoin via ETFs, active trading and bullish market sentiment. It is ripe for a revival, but the token’s price is constantly being beaten down by rising geopolitical tensions that are making investor sentiments sour.
As investors continue to receive updates about the worsening war situation in the area, Bitcoin prices are plummeting as they seek to secure their profit and protect themselves.
Federal Reserve’s Position on Inflation
Investors are currently cautious due to fears about inflation. Fed chair Jerome Powell made a series of announcements yesterday regarding the economy. Powell said that, as it stands now, the FED won’t be cutting rates. This has caused a market panic.
Due to the overwhelming debt that is weighing down the US Economy, current FED policy may lead to excessive borrowing and lending. This may accelerate excessive lending and borrowing. inflate The US debt metrics will reach dangerous levels. It may cause a collapse of the bond market, then an asset crash and a total economic meltdown.
Investors were compelled to panic due to the said event. It exacerbated Bitcoin’s dumping spree and added more pressure to the current Bitcoin price.
The Erratic Investor and FOMO
Bitcoin investors are now very greedy. Trading analogy greed Refers to purchasing an asset with the hope of making a profit in the near future.
An experienced trader with a good understanding of the fundamentals would hold an asset initially for a specified period, before selling it on the market. Due to the rising market pressures and FOMO, many investors have been selling their assets quickly. It may be contributing to Bitcoin’s current price fluctuation. It may also cause the price of a token to plummet. Retail greed may also be manifested as sentimental trading and panic sales, all of which are indirectly responsible for BTC’s price decline.
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Source: watcher.guru