Bitcoin Crash Income? Experts warn of 75% fall amid market turmoil!
Tuesday brought a crash alert to financial markets, with the S&P 500's 2% fall sending a ripple effect across the cryptocurrency market. Bitcoin's decline of 4.5% was very severe, which raised fears that it could lead to a major decline. Significant liquidity and bearish signals from key technical indicators further complicate the situation.
Here's what it means for you!
Bitcoin Struggle in Sync with S&P 500 Decline
The S&P 500's fall on Tuesday sent shock waves through both traditional and digital asset markets. While the index fell by 2.12%, Bitcoin followed, falling by 4.5% to reach the level of $56,500. This sharp decline has led to an increase in Bitcoin liquidity, exacerbating the downward pressure on the cryptocurrency. According to data from Coinglass, roughly $246.64 million worth of bitcoin is at risk of being wiped out if it falls below $56,840—a level it has breached.
Stochastic RSI signals can be a 75% breakout.
Crypto analyst Ali Martinez highlights bearish signals from Bitcoin Stochastic RSI on the 2-month chart. This indicator, which tracks momentum and market conditions, has moved from a bullish to bearish trend. Martinez said similar signals often precede significant corrections, with Bitcoin experiencing drops around 75.50%. If history repeats itself, Bitcoin could face a major downturn, adding to the market's risk.
Peter Brandt's Bearish View
Prominent trader Peter Brandt recently weighed in on Bitcoin, citing patterns of lower highs and lower lows. This market structure indicates a lack of strong buying interest, which may lead to further declines. Brandt's analysis suggests that without a resurgence in activity, Bitcoin is at risk of continuing its downward spiral.
Adding to the doldrums, spot Bitcoin ETF outflows increased, leaving more than $287 million off the market on Tuesday. This suggests that institutional investors are shifting away from riskier assets like Bitcoin and contributing more to the selloff. As these big players pull back, the market's ability to recover in the short term could be hampered.
The S&P 500 is charting declines.
The broader market decline was triggered by a subpoena issued by the US Department of Justice (DOJ) to chip maker Nvidia. The news sent Nvidia's stock tumbling 10%, sending other big tech companies and the S&P 500 down with it. The resulting turmoil spilled over into the crypto market, causing major losses in major cryptocurrencies including Bitcoin and various altcoins.
What does the future hold?
All eyes are now on the US Federal Reserve, which is expected to cut interest rates by 50 basis points on September 18. This decision could play a crucial role in determining whether Bitcoin can make a comeback or whether the bears will continue to dominate. The coming days are critical as Bitcoin faces bearish signals, institutional exits and market volatility.
