- Bitcoin’s price drops 8.5% in 72 hours, falling from $66,500 to below $62,000 amid market volatility.
- Federal Reserve Chair Jerome Powell signals a cautious approach to future rate cuts, shifting market expectations.
- The total crypto market cap drops 4%, falling to $2.17 trillion, in response to global instability.
Bitcoin (BTC) price has faced a significant downtrend recently. Recent comments by Federal Reserve Chair Jerome Powell and escalating geopolitical tensions have triggered this decline.
During a conference on September 30th, Powell gave some signals. He indicated that if the economy continues to perform as expected, the Fed’s policy would gradually shift toward a neutral stance. His remarks suggest that future rate cuts may be less aggressive than anticipated.
This, combined with the recent conflict between Iran and Israel, has spooked markets. It has sparked a significant sell-off in cryptocurrency, with Bitcoin bearing the brunt. In just 72 hours, the Bitcoin price plunged 8.5%, dropping from its recent high of $66,500 to below $62,000.
Additionally, BTC crypto has fallen below key technical levels. It has broken through the 20-day and 50-day EMA, though the 200-day EMA still provides some support.
The pressing question for traders is whether Bitcoin price will continue to shed or stabilize and eventually rebound.
Fed Signals a Cautious Path on Rate Cuts
Jerome Powell has reaffirmed the Fed’s careful stance on cutting interest rates, throwing cold water on hopes for aggressive easing. Powell said in a video conference that the Federal Open Market Committee (FOMC) is in no rush to lower rates.
“This is not a committee that feels like it’s in a hurry to cut rates quickly.”
This signals a more measured approach, casting doubt on earlier predictions of a 100 basis point reduction by year-end. Now, even a 50 bps cut looks uncertain. Bitcoin’s sharp price drop has been closely tied to the market’s response to Powell’s speech on future rate cuts.
Before his comments, traders had priced in more aggressive cuts, but expectations have shifted significantly. The reaction to Jerome Powell’s statements has heightened concerns over volatility. This is underscoring the crypto market’s vulnerability to Fed policy shifts.
Iran Missile Strikes Shake Markets, Crypto Reacts as Bitcoin Dips
A wave of nearly 200 ballistic missiles fired by Iran at Israel sent shockwaves across global markets. It has ignited widespread fear of an escalating geopolitical conflict.
Sirens blared across Israel. Then, a streak of flames lit up the night sky as most missiles were intercepted, with assistance from U.S. naval forces. Despite the successful defense, a few strikes landed, further fueling tensions.
In the wake of this news, major U.S. stock indices closed in negative territory. This wave of uncertainty is rattling traditional stocks. However, it also sent shockwaves through the cryptocurrency market.
The total crypto market value has plunged to $2.17 trillion in response to the mounting geopolitical crisis. It has marked a nearly 4% decline in the last 24 hours.
Bitcoin price also felt the impact, strongly plunging to $60,246 before quickly rebounding above the $61,000 mark.
The combination of Powell’s outlook on future rate cuts and the heightened geopolitical risk has significantly affected future price sentiment. This has caused volatility across both traditional and crypto markets.
Social media is buzzing with speculation about World War III, while news outlets worldwide are providing non-stop updates on the escalating tensions.
As anxiety grows among equity investors, the pressure on digital assets is equally intense. There are apparent signs of stability in sight.
Bulls Fight to Defend Key Support, Will BTC Rise?
Amid rising geopolitical tensions, Bitcoin has suffered a sharp decline. It has dropped to the critical 200-day EMA level.
When writing, bulls were barely holding on. They were struggling to defend against the mounting pressure from bears, who are currently in control.
If Bitcoin price breaches the 200-day EMA, the trend could shift decisively toward the bears. The price would have potential support levels at $60,000 and $58,000 coming into focus.
However, per the Bitcoin price analysis, if tensions ease and market sentiment improves, bulls could stage a recovery from the 200-day EMA. In such a scenario, upside targets would include $64,000 and $67,000, providing a potential pathway for Bitcoin to regain its footing.
Disclaimer
In this article, the views, and opinions stated by the author, or any people named are for informational purposes only, and they don’t establish the investment, financial, or any other advice. Trading or investing in cryptocurrency assets comes with a risk of financial loss.
