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Why Bitcoin Price is Down Today? What Next For BTC Price?

The Bitcoin market experienced a notable price drop today, as BTC plummeted from $63,446 to $60,763 within hours, marking a 4.3% decrease in the last 24 hours. Additionally, Bitcoin has seen a 15% decline over the past month since reaching a high of $70,000. This sudden decline is linked to various factors impacting the U.S. economy and investor sentiment.

Various Reasons Why Bitcoin Falling

U.S. Economic Indicators

The latest data on inflation and consumer sentiment in the United States played a crucial role in Bitcoin’s downward movement. The University of Michigan reported a decline in consumer sentiment from 77.2 in April to 67.4 in May, marking the lowest level in six months and missing market expectations. 

Moreover, inflation expectations for the year ahead rose to 3.5%, a six-month high, further contributing to economic concerns.

Caution From the Fed Reserve

Comments from Federal Reserve officials also contributed to market uncertainty. Fed Lorie Logan highlighted upward risks to inflation and emphasized the need for policy flexibility, indicating that a rate cut is premature. Similarly, Federal Reserve Governor Bowman emphasized the importance of maintaining policy stability over an extended period.

Outflows from U.S. Spot Bitcoin ETFs

In addition to economic indicators, outflows from U.S. Spot Bitcoin ETFs, notably the Grayscale Bitcoin Trust (GBTC), exceeded $100 million on Friday. This movement reflects investor caution in the face of economic uncertainties.

$50 M Liquidations

The broader crypto market experienced significant liquidations, totaling over $156 million within 24 hours. This included $131 million in long positions and nearly $25 million in short positions. The market saw more than $50 million in liquidations within just one hour, indicating a swift and impactful shift in sentiment.

Bitcoin Price Correction Ahead: $52k

Further,  Michael van de Poppe, a prominent cryptocurrency analyst, has highlighted the ongoing final accumulation phase in Bitcoin’s market dynamics. This phase is marked by periods of low volatility and choppy price movements, indicating a critical juncture in Bitcoin’s price action.

According to van de Poppe, Bitcoin is currently retracing towards an important support level. Failure to hold this level could lead to a deeper correction, with Bitcoin revisiting the $52,000 to $55,000 range. 

If reached, this range would signify the correction’s final stage before potential bullish momentum resumes.

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