Declining momentum in the crypto market, combined with ongoing geopolitical tensions, continues to hinder Bitcoin’s price trajectory, pushing it lower. and BTC price and sentiment decline Markets appear to be entering a phase of heightened uncertainty and caution as investors seek alternative assets to hedge geopolitical risks.
Bitcoin weakness reflects broader risk-off movement
Bitcoin is still on a downward trajectory Its price is trading below $70,000 due to geopolitical tensions around the world. Given the unfavorable conditions for Bitcoin and the sector, the market is currently at a critical juncture as to whether the bear market will reverse or continue.
walter bloomberg share that Bitcoin A look at the price of cryptocurrencies versus Nasdaq futures shows that stocks are falling as geopolitical risks spur risk-off trading. These synchronous declines indicate that market movements across different asset classes are once again being driven by macro variables such as changes in interest rate expectations and general risk aversion.
According to the report, Bitcoin fell 1.7% to around $67,000 as stock futures fell ahead of the US Open. Meanwhile, Nasdaq 100 futures fell 0.9% and S&P 500 fell 0.6%.
This development affected investor sentiment and focus. Now, heightened tensions over Iran, renewed debate about the broader economic effects of AI, and potential uncertainty are making investors more cautious. Fed rate cut Following recent inflation data.
Amid geopolitical tensions, capital flows, particularly from exchange-traded funds (ETFs), remain negative. US-listed Bitcoin ETFs recorded outflows for 4 consecutive weeks, More than $360 million was withdrawn in the last week alone. These outflows indicate a weakening of emotions, as shown by CryptoQuant’s Fear and Greed Index, which ranks at 10, which is classified as extreme fear.
As the market moves towards extreme fear levels, analysts believe that BTC may extend the ongoing correction phase with $60,000 being seen as the main support. However, further macro shocks are expected to push BTC price back towards the $50,000 threshold.
Which BTC investors are under stress
During periods of increasing bearishness, investor behavior and activity are critical in determining the current state of the market and the likely next direction. in recent analysisAnil, an on-chain researcher and investor, outlined the key differences between short-term and long-term Bitcoin holders.
Given the current market situation, BTC short-term holder They are experiencing periods of stress caused by surrender. On the other hand, long-term Bitcoin holders have not yet experienced any real stress or capitulation process.
It is worth noting that long term holder Eventually every cycle goes through a stage of capitulation and a new uptrend begins after a period of accumulation. However, it is difficult to judge whether the group will surrender this time as well. If this happens, Anil pointed out that the area below 1 on the LTH unrealized P&L chart will be a decisive point for the market.
Featured image from Pixabay, chart from Tradingview.com
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