The Bitcoin market faced a difficult episode when the price of Bitcoin had fallen briefly below the $ 30,000 level before recovering back at the $ 31,000 level. Bitcoin has thus lost $ 9000 from its highest value since May 5th.
With this Bitcoin has experienced a decline of over 17% in 7 days. Also following this trend are other cryptocurrencies resulting in the loss of more than $ 300 billion in total cryptocurrency market capital.
The crypto market worsened when BTC had closed its weekly trading low for six consecutive weeks which is something that has not happened in 8 years. Taking this into account, some analysts argue that it is likely that prices will be in a recession phase.
In addition, among the factors driving the fall in BTC prices is the global macroeconomic uncertainty in 2022 following the Covid-19 outbreak and the Russian-Ukrainian war conflict resulting in high inflation.
The U.S. Bureau of Labor Statistics (BLS) previously reported that the Consumer Price Index reading hit 8.5%, again hitting another 40 -year high. To combat rising inflation, the Federal Reserve has begun raising interest rates, with the latest increase amounting to 0.5% and is expected to continue to raise interest rates.
Another factor, the overall uncertainty caused by rising inflation has affected both retail investors and Wall Street, as the market has flowed out continuously over the past week, where the frequency has been more frequent in the last few days.
Stock markets like the S&P 500 are down more than 4%since May 5, the Dow Jones Index is down nearly 6%, while the NDX is down 6.2%. Lately cryptocurrencies are seen to have a significant correlation with the stock market. During a downturn, risky markets will often be liquidated.
Data from Glassnode revealed that the volume of exchange inflows adjusted for the 7 -day moving average reached a 3 -month high since yesterday. It is seen that whale groups are starting to thaw their crypto and it can also be interpreted as a preparation for a longer recession.
Glassnode also revealed that more than 26.5K BTC were added during the day period surge but are now starting to sell out.
The technical indications for BTC are also not so good with the weekly chart having closed lower for 6 consecutive weeks. In addition to the $ 37,000 support level zone has been broken, the next important support level is $ 30,000.
