Why did Bitcoin price drop?

Why did Bitcoin price drop? Picture 1

Upcoming PCE data on Friday April 26 will be a surprise and we will see where the Fed stands in the fight against inflation. More importantly, three months of poor inflation data have completely dampened optimism about a Fed rate cut.

Last year, even the most cautious experts predicted interest rates would fall in June, but now there is talk of a further 25 basis point increase.

The failure to control inflation, which negatively affects risk markets, has recently been exacerbated by tensions between Iran and Israel. Although the mutual attacks have stopped for now, this is not something that can disappear in a day.

Additionally, net capital outflows increased rapidly through the ETF channel with Genesis sales yet to fully return. The lack of increased risk appetite among investors familiar with traditional markets has also hindered BTC's rise.

The halving did not initiate the expected upward movement, so Bitcoin price could retest the $60,000 level once again. If it closes below $63,224, the $59,750 area could be targeted. This test could cause double-digit losses for altcoins.

Kareem Winters

Update 25 April 2024