Bitcoin is losing momentum once again after Wall Street’s poor performance on Monday. The selling pressure comes just ahead of the release of US inflation figures this week.
Bitcoin (BTC) price movement and volatility has recently made life hell for traders. On Tuesday, June 7, the price of BTC crashed more than 7%, giving up all of its gains from the start of the week and once again falling below the $30,000 mark.
Bitcoin saw price swings in the range between $29,000 and $32,000. During the month of May, bitcoin suffered a sharp market correction, eroding over $120 billion in market capitalization. In a note to investors, Adam Farthing and Collin Howe of cryptocurrency liquidity provider B2C2 wrote:
“This market is moping. Without an upside catalyst, current sentiment is likely to keep prices rangebound, with some clear and immediate risk of a downside breakout.”
Tuesday’s drop follows a choppy Monday in the US stock market. Markets started on a positive note on Monday, but all three U.S. equity indices gave up gains later in the day. In addition, the jump in the Treasury yield also raised fears that rising borrowing costs could lead to a recession. This could only put further pressure on bitcoin and other risky assets.
New fix for bitcoin coming?
Bitcoin showed weakness on the technical chart. The world’s biggest crypto is likely to come under further selling pressure as the US is due to release its inflation rate figures for May before this week.
During the month of April, inflation showed some signs of slowing down. It would be a welcome sign if it continues to fall. However, if the inflation numbers are high, the Fed will take action to raise interest rates.
According to crypto analyst @SmartContractorbitcoin has formed a bearish flag pattern and it may see further capitulation below $24,000, which could serve as a buying opportunity.
— Bluntz (@SmartContracter) June 7, 2022
It will be interesting to see how bitcoin performs in the future. However, the recent price move has certainly been a traders nightmare.