In January, when it was announced that the U.S annual inflation rate had hit a 40-year high of 7%, Bitcoin dropped under $40k as the Fed reacted by stating it would raise interest rates for the first time in more than three years.
Less than a month later, the inflation rate has accelerated from 7.0% to 7.5%. The NASDAQ 100 ended the day with a 2.10% loss in response.
The downtrend has spilled into the crypto market, with Bitcoin dropping by more than 4% over the last 24 hours. The price drop has sent Bitcoin crashing from $45,661.17 down to an interday low of $42,850.
Marginal gains over the last few hours now see bitcoin trading at $43,482.
The 24 hours price chart of Bitcoin (BTC). Source: Tradingview
With Bitcoin’s first major support level at $42,578, its price will look to reclaim $44,208 before retesting the resistance level at $45,161. However, falling below the support level could see Bitcoin spiral down to $41,625.
The Broader Crypto Market Joins the Decline
The price drop which started with Bitcoin has spread through the broader cryptocurrency market, with Ethereum losing 5% to drop to $3,097.4.
The 24 hours price chart of Ethereum (ETH). Source: Tradingview
Other altcoins have recorded bigger losses, with XRP and Polkadot (DOT) both showing a -9% over the last 24 hours to trade at $0.8193 and $20.5, respectively. Solana (SOL) is also down by 8% and now trades at $106.15.
As a result, the global market cap has lost approximately 3% in valuation, dropping from above $2 trillion down to $1.943 trillion.
The 24 hours chart of the global crypto market cap. Source: Tradingview
On the Flipside
In spite of Bitcoin’s pullback, the Bitcoin Fear & Greed Index has held steady at 50/100 – which signifies neutrality.Why You Should Care
While the news ends Bitcoins winning streak, it also reveals once again Bitcoin’s increasing synced movement with traditional stocks.
EMAIL NEWSLETTERJoin to get the flipside of crypto
[contact-form-7]
Bitcoin Price Updates, Bitcoin, Bitcoin (BTC), inflationRead More
You might also be interested in reading Pump.fun launches down more than 80% from peak.