1. US economic indicators
The latest inflation and consumer confidence data from the United States played a crucial role in Bitcoin’s decline. The University of Michigan reported that the consumer confidence index fell from 77.2 in April to 67.4 in May, hitting a six-month low and below market expectations.
In addition, inflation expectations for the coming year rose to 3.5%, a six-month high, further exacerbating economic concerns.
2. Federal Reserve’s warning
Comments from Fed officials also added to market uncertainty. Fed Governor Lori Logan highlighted the upside risks to inflation and stressed the need for policy flexibility, suggesting that it was too early to cut interest rates. Similarly, Fed Governor Bowman stressed the importance of maintaining policy stability over the long term.
3. US Spot Bitcoin ETF Fund Outflow
In addition to economic indicators, outflows from U.S. spot Bitcoin ETFs, especially Grayscale Bitcoin Trust (GBTC), also exceeded $100 million on Friday. This trend reflects investors’ cautious attitude in the face of economic uncertainty.
4.5000 million yen settlement
The broader cryptocurrency market experienced massive liquidations, with liquidations totaling over $156 million in 24 hours. This included $131 million in long positions and nearly $25 million in short positions. The market saw over $50 million in liquidations in just one hour, demonstrating a rapid and effective shift in sentiment.
5. Bitcoin price adjustment is coming: $52,000
Additionally, renowned cryptocurrency analyst Michael van de Poppe highlighted the ongoing final accumulation phase in Bitcoin market dynamics. This phase is characterized by low volatility and price swings, which suggests that Bitcoin price action is at a critical juncture.
Bitcoin is currently retracing to an important support level, van de Poppe said. Failure to hold this level could lead to a deeper correction that would see Bitcoin return to the $52,000 to $55,000 range.
