Bitcoin, over the last seven days, experienced its lengthiest losing streak. This losing streak was the longest since the one in 2018. The fall, witnessed by bitcoin, pushed it towards the $40,000 level. This level represents, for bitcoin, a major psychological threshold.
BTC is currently being traded at $40,800. This represents a 2.3% intra-day fall. This losing streak is the longest since a similar fall seen between July and August 2018.
However, BTC’s price has not slipped below $40,000 since 2021. Also, it has not been able to breach its November high of $69,000. BTC was launched in 2009 and although it marked its 13-year anniversary week, there were no celebrations.
Bitcoin Price Trends
Crypto analysts forecast that BTC’s losing streak might continue, and the fall might even become steeper. However, there were also signs that the market was stabilizing. Although January has been historically a poor month for BTC, this year has been particularly bad, with BTC seeing a fall of 11%.
The turbulence in the crypto market is attributable to the Fed’s announcement that it was contemplating some stronger measures to check ballooning inflation. The current inflation is at its highest level in the last four decades.
Crypto investors feel that BTC had earlier benefited enormously from the Fed’s monetary policy of injecting $4 trillion into the economy. This was done by the Fed to stimulate the economy following the pandemic-induced slowdown. A change in this policy is seen as detrimental to BTC’s prospects.
Like tech stocks, investments in BTC are seen as risky. Fed’s change in policy is therefore dissuading investors from high-risk investments.
The market is watching for BTC to reach its floor price. It has fallen 35% from its high. Past precedence shows that it could even fall as much as 80%. However, some bullish investors predict a recovery soon.