Bitcoin has fallen below the important technical support level of 112,000 USD, causing market sentiment to turn negative.
This trend reflects the seasonal weakening in August along with macroeconomic instability due to adjusted labor market data, creating downward pressure on Bitcoin and other risk assets.
MAIN CONTENT
Bitcoin has fallen below the technical support level of 112,000 USD.
The seasonal factor in August and poor labor data negatively impact the market.
The market has expected two rate cuts, with the first one anticipated in September.
What caused Bitcoin to fall below the important technical support level?
Analyses from Matrixport indicate that Bitcoin has lost the support level of 112,000 USD in recent weeks due to seasonal factors and the unstable global economic situation.
Seasonal factors in August often reduce demand in the cryptocurrency market, combined with downward adjustments in labor data adding negative pressure. Consequently, investor sentiment becomes more cautious, making it difficult for Bitcoin to maintain important price levels.
What impact do negative labor data and expectations of interest rate cuts have on the market?
Adjusted labor data presents challenges for the U.S. economy, increasing the likelihood that the Federal Reserve (Fed) will cut rates to stimulate growth.
The market has anticipated the Fed will cut rates twice, with the first cut possibly occurring in September; however, this is not enough to immediately boost positive sentiment. Therefore, risk assets like Bitcoin tend to underperform until economic and market indicators improve markedly.
"The Fed's unexpected 50 basis point rate cut last year created a significant shock to the financial markets, and currently, similar pressure is affecting Bitcoin through weakened economic data."
Market analyst, Matrixport, August 2024
When can the cryptocurrency market recover based on current economic signals?
The bearish state of Bitcoin and other risk assets is likely to persist until there is a significant improvement in fundamental economic indicators such as labor data and monetary policy measures.
An official rate cut from the Fed could provide positive support, but this must be accompanied by macroeconomic stability to build trust among cryptocurrency investors. Experts recommend closely monitoring policy moves and economic data in the coming months.
Frequently Asked Questions
What does Bitcoin losing the support level of 112,000 USD mean?
This is a bearish warning sign, reflecting negative psychological pressure and could lead to continued adjustments in the short term.
Why does labor data affect Bitcoin?
Poor labor data increases the likelihood of interest rate cuts, directly impacting confidence and inflows into risk assets like cryptocurrencies.
Is the timing of the Fed's next rate cut important?
Yes, the first rate cut expected in September will have a significant impact on the trends in financial and cryptocurrency markets.
Can Bitcoin recover quickly after this decline?
There needs to be a clear improvement in economic data and monetary policy for the cryptocurrency market to stabilize again.
What should investors do during this period?
Caution is recommended, closely monitor economic reports, and avoid investing in risk assets while the downward trend shows no signs of stopping.
Source: https://tintucbitcoin.com/bitcoin-giam-khi-du-lieu-viec-lam-yeu/
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