Bitcoin Could Lose on Thursday, heading for its fourth loss in a row, as it plummeted to week lows and came close to trading below the psychological barrier of $60,000. This downward trend is driven by strong risk aversion in the cryptocurrency market, fueled by rising US 10-year treasury yields. As traders await more speeches from Federal Reserve officials, the uncertainty surrounding US interest rates contributes to Bitcoin’s decline.
Bitcoin’s Decline and Its Impact
Bitcoin fell by $508, or 0.8%, at Bitstamp to $60,634, with a session-high at $61,757, after losing 1.8% on Wednesday
the third loss in a row. The ongoing decline is influenced by strong risk aversion, with market sentiment turning more cautious amid rising US treasury yields. The prospect of losing the psychological barrier of $60,000 has further fueled concerns among investors.
US 10-Year Treasury Yields and Risk Sentiment
US 10-year treasury yields rose by 0.4% on Thursday, extending gains for the second session and contributing to the risk aversion in the markets. Higher treasury yields can dampen risk appetite, leading to increased selling pressures in the cryptocurrency market. The impact of these trends on Bitcoin has been significant, driving the price downward.
Crypto Market Value and Aggressive Selling Pressures
The broader cryptocurrency market experienced a reduction in market value due to aggressive selling pressures. The total market value of cryptocurrencies fell by $20 billion on Thursday to $2.370 trillion
with both Bitcoin and Ethereum facing heightened selling activity. This decline in market value underscores the risk aversion prevailing in the crypto market.
Expectations for US Interest Rate Cuts
Investors are now focusing on speeches by Federal Reserve officials to gather clues about the future of US interest rates. The Fedwatch tool indicates that the odds of a Fed 0.25% interest rate cut in June stood at 9%
while the odds for July rose to 32%, and the odds for September increased to 66%. Despite these trends, expectations for two interest rate cuts this year, likely in September and November, remain uncertain.
Bitcoin’s Outlook and Risk Factors
The outlook for Bitcoin is influenced by various risk factors, including rising US 10-year treasury yields and changing interest rate expectations. The potential loss of the $60,000 trading mark could have broader implications for Bitcoin’s trajectory. As market sentiment remains cautious, Bitcoin’s future direction will depend on several factors
including Federal Reserve policies and global market trends.
Conclusion
Bitcoin’s decline and the risk of losing the $60,000 trading mark are driven by a combination of factors
including risk aversion, rising US 10-year treasury yields, and changing interest rate expectations. The uncertainty surrounding Federal Reserve policies and the broader market sentiment continues to impact Bitcoin’s trajectory. As investors monitor the crypto market and key economic indicators, the outlook for Bitcoin remains dynamic.
FAQs
Q1: Why is Bitcoin at risk of losing the $60,000 trading mark? A1: Bitcoin is at risk of losing the $60,000 trading mark due to strong risk aversion in the cryptocurrency market
driven by rising US 10-year treasury yields and changing interest rate expectations. These factors contribute to heightened selling pressures and a cautious market sentiment.
Q2: How do US 10-year treasury yields impact Bitcoin? A2: Rising US 10-year treasury yields can dampen risk appetite, leading to increased selling pressures in the cryptocurrency market. Higher treasury yields may indicate a shift in investor sentiment, impacting the broader market and contributing to Bitcoin’s decline.
Q3: What is the significance of the Fedwatch tool’s predictions for interest rate cuts? A3: The Fedwatch tool’s predictions for interest rate cuts provide insights into market expectations for Federal Reserve policies. These predictions influence broader market sentiment and can affect the direction of the cryptocurrency market, including Bitcoin Could Lose.
Q4: How has the crypto market’s total market value affected by recent trends? A4: The total market value of cryptocurrencies fell by $20 billion on Thursday to $2.370 trillion due to aggressive selling pressures. This decline reflects the heightened risk aversion in the crypto market, impacting both Bitcoin and Ethereum.
Q5: What is the outlook for Bitcoin amid risk aversion and changing interest rate expectations? A5: The outlook for Bitcoin depends on various factors, including rising US 10-year treasury yields
Federal Reserve policies
and broader market sentiment. The risk of losing the $60,000 trading mark could have broader implications for Bitcoin Could Lose. As investors monitor key economic indicators, the direction of Bitcoin will continue to evolve.