The bitcoin price is still struggling below the crucial $85,000 barrier as the market mood is unstable due to growing sell-off forces.
Days of Coins Disrupted analytics indicate a concerning trend: short-term holders are selling off almost 10,000 BTC per day due to continued uncertainty.
Bitcoin, which is currently trading at $83,184, could move lower if it cannot recover important resistance levels, especially since $82,761 is a critical support.
Constant selling pressure underscores Bitcoin’s difficulties, particularly from new market participants looking to sell their holdings.
Increased volatility, decreased demand, and tighter liquidity contribute to this predicament by impeding significant accumulation. Without increased buying activity, Bitcoin faces a serious risk of future price drops.
The lack of significant accumulation feeds a generalized concern in the digital asset community, which is exacerbated by the absence of clear, optimistic indications. Bitcoin is still susceptible to harmful price declines as selling pressure keeps increasing.
Trade war worries are a factor
Bitcoin failed to sustain gains as trade war worries weighed on sentiment, even in the face of lower-than-expected U.S. inflation statistics.
The Consumer Price Index (CPI) increased by 2.8% in February, less than the estimated 2.9%, according to the most recent economic data, which was made public on March 12. With food and energy excluded, the core CPI fell to 3.1%, somewhat better than the 3.2% forecast.
In response, the markets increased their wagers on the Federal Reserve’s rate reduction. From just 9% last month, traders now factor in a 31.4% possibility of a cut in May. By year-end, the likelihood of three cuts increased to 32.5%, while four cuts increased from 1% to 21%.
Canada has levied $21 billion in tariffs on U.S. exports in retaliation for U.S. steel and aluminium levies. In response, the European Union levied another $28 billion in taxes on American imports. Growing trade disagreements have raised concerns that they could exacerbate inflationary pressures and make it more difficult for the Fed to make decisions.
What To Note
The Kobeissi Letter estimates that the United States will have to refinance $9.2 trillion in debt by 2025.
- Borrowing costs might increase significantly without decreasing interest rates, further taxing the nation’s already $36 trillion debt. Investors are keeping a tight eye on changes in monetary policy and international trade, and market uncertainty is still high.
- According to on-chain data, bitcoin traders are becoming less confident. Santiment claims that trade activity in the cryptocurrency space has been decreasing since its high in late February.
- Market capitalisation losses over the past two weeks have made traders cautious, and symptoms of fatigue and surrender are beginning to appear. Not even the CPI-driven bounce in Bitcoin generated a significant increase in trading activity.
In the context of modest price recovery, this volume fall usually denotes weak market momentum. G gains can quickly fade without significant purchasing activity, leaving prices vulnerable to more drops. Institutional and retail traders wait for each other to move in a holding pattern. Caution is likely to rule until volume significantly increases.
