Bitcoin’s price tumbles as recession fears

5 Ağustos 2024

Today’s markets analysis on behalf of George Pavel General Manager at Capex.com Middle East

Bitcoin (BTC) started the week under significant selling pressure, briefly dipping below the USD 50,000 mark for the first time in six months. This drop, which began on Friday after disappointing US jobs data, saw Bitcoin’s price fall by 24% and the overall market capitalization decrease, erasing about USD 400 billion.

The US NFP jobs report showed only 114,000 new positions, well below the anticipated 175,000. This shortfall heightened recession fears and raised concerns that the Federal Reserve might have been too slow to cut interest rates. As a result, investors hurried to close their long positions, amplifying the downward price movement.

In the past 24 hours, more than USD 900 million in long positions were liquidated compared to only USD 160 million in short positions, signaling a significant correction in leveraged trades and a lack of investor confidence, leading to further price declines.

At the same time, the cryptomarket could react to potential new investments in bitcoin from MicroStrategy which plans to the equivalent of USD 2 billion in BTC. US PMI data could also alleviate recession concerns if the figures are stronger than expected.

 

Zaid Barem / YMM