The recent dip in Bitcoin has fueled market concerns, with the crypto dropping below $59,000. The sudden freefall in BTC price has left investors looking for potential reasons behind the drop. It appears that a flurry of factors are in play behind the recent selloff, including macroeconomic concerns and other market trends.
So, let’s take a quick tour of the potential reasons behind the recent dip in BTC price.
Why Is Bitcoin Dropping Today?
The recent selloff was sparked by a massive dump by a whale one of the leading crypto exchanges recently. In addition, recent reports indicate that investors are staying on the sideline ahead of big earnings that are expected to set the path ahead for the US stock market.
Traders Await Nvidia And Other Earnings Results
The investors appear to be taking a pause ahead of big tech earnings this week which includes the chipmaker NVIDIA. The chipmaker is expected to release its Q2 FY25 financial results on August 28, after the market close. In addition, other big techs including Salesforce, CrowdStrike, and HP Inc., among others are also scheduled to report their earnings tomorrow.
Having said that, it appears that the investors are seeking further clarity before putting their bets into riskier assets like Bitcoin as well as in the overall crypto market. A recent CNBC report citing Wolfe Research said that Nvidia earnings will play a crucial role in setting the market sentiment this week.
US PCE Inflation Data To Impact BTC Price
The traders are also awaiting the US PCE data to gauge the latest inflationary pressure in the country. Although bets are soaring over a potential rate cut by the US Federal Reserve, especially after Jerome Powell’s speech last week, investors would be keeping a close watch on the upcoming economic figures.
The Fed Chair hinted at a dovish move with their policy rates going forward. However, he also said that the central bank will be evaluating the future economic data while deciding its next stance. Having said that, if the US PCE inflation figures come in hotter than expected, it could dampen the sentiment of the broader financial market.
In addition, the US job data, scheduled for September 6, will also play a key role in deciding the Fed’s next move with their interest rate plans. However, according to the CME FedWatch Tool, there are 66% odds of a 25bps rate cut by the central bank at their September meeting.
Whale Dump Sparks Concern
A recent report from Whale Alert showed that a whale, identified by the wallet address “bc1qc….e3gvh” had moved 2,300 BTC, worth $141.81 million, to Kraken before the BTC crash. According to Arkham Intelligence report, the whale still holds 18.141K BTC, worth $1.07 billion.
Considering that, if the whale decides to book profit, it could impose immense pressure on the crypto. Notably, the recent surge in the crypto’s price to nearly $65K has helped many investors to book profit, especially after volatile trading over the past few days.
BTC Price Dips Below $59K
As of writing, BTC price was down 6.59% to $58,893, while its trading volume soared 30% to $37.30 billion. Over the past hour, the crypto has touched a low of $58,116, while hitting a 24-hour high of $63,210.80.
Meanwhile, BTC Futures Open Interest (OI) dropped over 7% over the last 24 hours to $31.09 billion, while noting a drop of around 3% in the past hour. Besides, over the last hour, the flagship crypto has faced liquidation of $26.35 million, CoinGlass data showed. In a 24-hour time frame, the overall crypto market noted a liquidation of $312.94 million.
However, despite the recent downturn, a recent Bitcoin price prediction hints that the crypto could hit $65,000 soon if it breaks a key resistance level.
Rupam Roy
Rupam, a seasoned professional with 3 years in the financial market, has honed his skills as a meticulous research analyst and insightful journalist. He finds joy in exploring the dynamic nuances of the financial landscape. Currently working as a sub-editor at Coingape, Rupam’s expertise goes beyond conventional boundaries. His contributions encompass breaking stories, delving into AI-related developments, providing real-time crypto market updates, and presenting insightful economic news. Rupam’s journey is marked by a passion for unraveling the intricacies of finance and delivering impactful stories that resonate with a diverse audience.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
