Bitcoin price is falling sharply again and the market is becoming increasingly negative

Bitcoin (BTC) was rejected again around USD 27,400 yesterday and then steadily dropped towards USD 27,150. From there, bitcoin took a big plunge this morning, reaching as low as $26,600. At the time of writing, the BTC price stands at $26,691 on Binance and $24,755 on Bitvavo. This puts the bitcoin price down 2.3% today. The total market capitalization is $518 billion and the dominance is 46.3%. The Fear & Greed Index comes out at 50 (Neutral).

Debt ceiling drama not over yet

The uncertain macroeconomic situation is gripping the financial markets. Yesterday again no deal was made on the US debt ceiling. The Republicans apparently want to keep it exciting.

Yellen speech and FOMC minutes today

Meanwhile, inflation in the United Kingdom is higher than expected and New Zealand raises interest rates again by 0.25% to 5.50%. Later today we will receive a speech from US Treasury Secretary Janet Yellen, followed by the publication of Federal Open Market Committee (FOMC) minutes, the minutes of the last interest rate meeting.

Bitcoin volatility extremely low

Whether the above developments can cause some volatility, however, remains to be seen. This is currently extremely low. Analysis firm CCData reports that bitcoin’s volatility will drop to 48.2% in 2023 from 62.8% in 2022 and 79% in 2021.

Also low volume and liquidity

However, this does not only apply to volatility, liquidity is also drying up, reports analyst Jack Neureuter. The trading volume on crypto exchanges is currently very low, even the lowest since 2020.

Whales and shark are preparing

We therefore see that large investors, the so-called whales & shark, not accumulating bitcoin. On the other hand, they are accumulating stablecoins, reports analysis company Santiment. That is a sign that they are increasing their purchasing power for a later time.

Bitcoin tests important moving average

Bitcoin price is currently retesting the 100-day moving average which is around $26,640. If it doesn’t hold, however, then the infamous 200-week moving average around $26,280 is on its way, as analyst Material Indicators points out.

BTC analysts turn bearish

It is noticeable that the recent positive attitude continues to weaken and more and more analysts bearish become. This analyst also initially expected that the bulls would show more strength, but he now expects a significant drop for bitcoin, possibly as low as $23,200.

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