Current Bitcoin price relative to historical trends
As of March 20, 2025, the price is around $86,000 (CoinMarketCap - Bitcoin Price). This price is below the historical high of $109,114.88 on January 20, 2025, indicating that Bitcoin has retraced since its historical peak. According to market data, Bitcoin had 13 green days (43%) in the past 30 days, with a price volatility of 6.27%, showing some short-term volatility (Changelly - Bitcoin Price Prediction).
Technical indicators show that the short-term (4-hour chart) trend may be bullish, with the 50-day moving average rising, but the long-term (daily chart) trend is bearish, with the 200-day moving average declining since March 16, 2025 (Changelly - Bitcoin Price Prediction). The relative strength index (RSI) is currently at 42.66, which is in the neutral range (30-70), indicating that the market is neither overbought nor oversold (CoinCodex - Bitcoin Price Prediction).
Market sentiment analysis
Market sentiment is a crucial factor in determining the short-term price movement of Bitcoin. Currently, the Bitcoin Fear and Greed Index is 32, which falls into the 'fear' range (Alternative.me - Fear and Greed Index). This index is calculated based on multiple indicators, including price momentum, volatility, derivatives market, and social media sentiment (CoinMarketCap - Crypto Fear and Greed Index). Fearful sentiment usually indicates that investors are overly worried, which may lead to increased selling pressure and further price declines.
Historical data shows that the panic phase may be a buying opportunity, but it could also extend the short-term downward trend. Over the past 30 days, Bitcoin has had 43% green days, indicating high market volatility and unstable investor sentiment (Changelly - Bitcoin Price Prediction). Additionally, some technical analyses show that the overall market sentiment is bearish, with 23 bearish signals compared to 7 bullish signals (CoinCodex - Bitcoin Price Prediction).
Impact of U.S. interest rate cut policies
The monetary policy of the Federal Reserve has a significant impact on global financial markets, especially on risk assets like Bitcoin. On March 19, 2025, the Federal Reserve decided to maintain the federal funds rate target range between 4.25% - 4.5% after a two-day policy meeting (NBC News - Federal Reserve Interest Rate Decision). This decision aligns with market expectations, which virtually do not anticipate rate cuts in March (CNBC - Fed Rate Decision March 2025).
Nevertheless, Federal Reserve officials stated after the meeting that there may be rate cuts later in 2025, such as in June, with an anticipated overall cut of 0.5% for the year (U.S. Bank - Federal Reserve Holds Interest Rates Steady). Rate cuts are usually beneficial for Bitcoin, as a low-interest-rate environment may encourage investors to seek higher-return assets like cryptocurrencies (Forbes - Bitcoin’s Price Prediction For 2025). However, as rate cuts have not yet occurred, the support for Bitcoin from the interest rate environment has not yet manifested in the short term.
Additionally, the tariff policies of the Trump administration have increased economic uncertainty, and the Federal Reserve has warned that economic growth forecasts have been downgraded to 1.7%, with inflation expectations rising to nearly 3%, which may further impact market sentiment (NBC News - Federal Reserve Interest Rate Decision).
Feasibility analysis of short-selling Bitcoin
Based on the above information, the feasibility of short-selling Bitcoin requires comprehensive consideration of the following factors:
Short-term short-selling opportunities:
Current market sentiment is fear (Fear and Greed Index at 32), prices are below historical highs, and technical indicators show more bearish signals, which may provide short-selling opportunities in the short term.
Some analysts predict that Bitcoin may further decline in the short term, for example to $74,038 (WalletInvestor via Forbes - Bitcoin Price Forecasts).
Long-term risks:
If the Federal Reserve cuts rates later in 2025, it may boost Bitcoin prices, with some forecasts suggesting Bitcoin could reach $200,000 by 2025 (CNBC - Bitcoin Price Predictions).
Market sentiment may shift from fear to greed, especially under the expectation of interest rate cuts, and prices may rebound.
Conclusion
Based on the above analysis, considering the Bitcoin price of $86,889.74 on March 20, 2025, market sentiment (fear, Fear and Greed Index at 32), and the Federal Reserve's decision to maintain rates, short-selling Bitcoin in the short term may be a viable strategy, especially if market sentiment continues to deteriorate. However, it is important to note the potential rebound risks from future rate cuts and Bitcoin's high volatility. Investors should closely monitor market dynamics and conduct thorough research before making decisions.
What would you choose?
