Bitcoin price drops due to inflation concerns and economic data

The price of Bitcoin ($BTC ) has fallen below 113,000 USD for the first time since August 2, amidst investor concerns about inflation, trade tensions, and rising bond yields. This decline reflects a risk-averse sentiment in the broader financial market.

Main reasons

Macroeconomic concerns: The release of important economic data, including employment and production reports, has created uncertainty. Investors are awaiting signals from Fed Chair Jerome Powell at the conference in Jackson Hole regarding the possibility of interest rate cuts. Although the administration $TRUMP has pressured the Fed, signs of rising inflation and the impact of the trade war have made the Fed cautious.

Profit-taking: After reaching a record high of 124,128 USD last week, Bitcoin has experienced significant profit-taking. Ethereum also dropped after nearly reaching its all-time high.

Liquidation: Juan Leon, an investment strategist at #Bitwise , stated that profit-taking has led to consecutive liquidations, especially of leveraged long positions.

Market impact

The drop in Bitcoin coincides with a retreat in the stock market and other risk assets. Major indices such as the S&P 500 and Nasdaq have both declined.

Market sentiment is currently in a "risk-off" phase. Analysts are closely monitoring Bitcoin's key support levels to see if the downward trend will continue.

Source: #Decrypt