As a seasoned crypto investor with a few battle scars on my portfolio, I’ve learned to expect the unexpected when it comes to this volatile market. Tuesday’s Bitcoin plunge was yet another reminder of the rollercoaster ride we’re all strapped into. The sudden drop in price triggered a series of liquidations, causing a ripple effect that affected other cryptocurrencies as well.
As a crypto investor, I’ve witnessed a substantial downturn in the market on Tuesday. Bitcoin (BTC) took a nose dive and plunged as low as $64,600 during early Asian trading hours. Consequently, this steep decline triggered liquidations among leveraged traders, resulting in a staggering loss of approximately $440 million.
Photo: CoinMarketCap
As an analyst examining the latest market data from CoinGlass, I can report that my analysis reveals a significant negative impact on leveraged long positions within the past 24 hours. Specifically, approximately $420 million, representing around 87.5% of all liquidations, originated from bullish Bitcoin wagers. This finding indicates that a considerable number of traders held optimistic views regarding Bitcoin’s short-term price movement but were taken aback by the abrupt price shift.
Bitcoin Slide Triggers Crypto Market Selloff
Approximately $336 million worth of long positions were eliminated on prominent exchanges such as Binance, OKX, and HTX. Despite this significant loss, Bitcoin has exhibited some tenacity and presently trades above $65,390. Nevertheless, the larger crypto market is still experiencing repercussions.
Photo: Coinglass
As a cryptocurrency market analyst, I’ve observed that Bitcoin’s recent downturn initiated a domino effect throughout the crypto sphere. Ethereum (ETH), the second-largest digital asset, experienced a decline of approximately 2.18% in the past day and is now hovering around $3,440. Moreover, some popular altcoins such as Solana (SOL), Toncoin (TON), and Cardano (ADA) took a bigger hit, with losses amounting to 4.70%, 5.20%, and 6.70% respectively.
As a researcher studying the meme coin market, I’ve observed some significant downturns in this sector over the past day. For instance, Dogecoin (DOGE), famously referred to as the “currency for internet dogs,” experienced a decline of approximately 8.40%, now trading at $0.1219. Additionally, other popular meme coins such as Shiba Inu, PEPE, Dogwifhat, and Floki faced even more substantial losses, with their prices dropping by over 10%.
Fed Rate Hike Holds Back Crypto Market Rebound
Recent market sentiments are partially influenced by the ongoing battle against inflation. Last week, the Federal Reserve opted to maintain the interest rate at its highest level in 23 years, ranging between 5.25% and 5.5%. This decision underscores the Fed’s cautious approach to loosening monetary policy until there is definitive evidence of decreasing inflation.
Although inflation has shown some deceleration, as evidenced by a 3.3% increase in consumer prices last month versus a 3.4% rise in April, it remains higher than the Federal Reserve’s desired 2% mark. Fed Chairman Jerome Powell acknowledged progress toward reducing inflation but emphasized that more concrete evidence is necessary before considering any reduction in interest rates.
As a researcher studying the Federal Reserve’s monetary policy, I have found that the central bank now projects a single rate cut in 2024 instead of the previously anticipated three cuts. This shift in expectation comes as the Fed grapples with inflationary pressures. Consequently, investors should prepare for continued volatility and potential price fluctuations in the cryptocurrency market due to this uncertainty.
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2024-06-18 14:36