The US markets closure has led to a notable decline in Bitcoin prices, with rapid sell-offs continuing to push the cryptocurrency to deeper lows. On September 6, most cryptocurrencies turned red, with Bitcoin (BTC) priced at $52,700 at the time of writing, marking a 24-hour loss exceeding 6%. Concurrently, US stock markets experienced one of their worst weeks in recent years.
Impacts of the Fed Rate Expectations
The sharp decline in Bitcoin’s price is noteworthy, especially given the positive US data. The expectation for a Federal Reserve rate cut dropped drastically from 50 basis points to 25 basis points after market opening. Investors are recalibrating their projections downward despite employment data suggesting a higher likelihood of rate increases.
Potential Risks from Bank of Japan
The Federal Reserve has maintained peak rates for over a year, with the first rate cut in four years expected in 11 days. Historically, risk markets witness rapid losses during Fed rate cuts, although these are supportive factors for medium-term increases. However, the Bank of Japan’s potential further rate increases pose a significant risk to this scenario. If continued, this could lead to one of the worst days in risk markets in recent years.
Key Takeaways
- BTC dropped to $52,650 at the time of writing.
- NASDAQ100 experienced its biggest weekly loss since November 2022.
- Ripple’s Founder Chris Larsen donated to Kamala Harris.
- Coinbase added ZK Coin to its listing roadmap.
- Fed/Goolsbee: There is a broad consensus for multiple Fed rate cuts.
- SEC announced the cancellation of Salt Blockchain’s certification.
- Markets are giving more probability to a 25bp cut. After US data, the 50bp cut probability rose to 59% and now dropped to 43%. (Change occurred 10 minutes after US markets opened)
- Binance listed NEIROETH in futures trading.
- Fed/Williams: Ready to start the rate cut process.
- Non-Farm Payrolls Announced: 142K Expectation: 165K Previous: 114K
- Telegram CEO Pavel Durov mentioned in a new message that the platform is under investigation in Paris due to misuse and promised to enhance security.
Analysts suggest that due to a lack of demand at resistance levels and repeated tests of supports, Bitcoin’s price could weaken further, potentially leading to new lows for altcoins in 2024.
