Bitcoin Drops Below $36,000 as Crypto Market Crashes—Here’s Why

On Thursday afternoon, Bitcoin's price fell 7.90 percent to $35,571.90, wiping away Wednesday's gains of 5.20 percent to $40,023.10 after the Federal Reserve stated it will battle inflation without raising interest rates further.

Some of the decreases were caused by a mix of causes, according to Bill Noble, Chief Technical Analyst at Token Metrics. It might be due to low-quality coins, Elon Musk's harsh statements, or China's recent crackdown on crypto services, according to Noble.

Similarly, recent price fluctuations have coincided with rising inflation, continued uncertainty over the country's prolonged COVID-19 battle, and new regulatory moves by the US government, notably Vice President Joe Biden's recent executive order.

According to a report by Glassnode Insights, a blockchain analysis firm, new short-term investors who are selling their holdings in response to the latest decrease may be adding to the reduction in Bitcoin's value.

For several weeks, Bitcoin has been trading in a narrow range, primarily soaring between $36,000 and $42,000. Bitcoin could find "medium-term support" between $31,000 and $37,000, according to Kiana Danial, crypto expert and CEO of Invest Diva, who recently announced on TikTok.

Experts advise keeping bitcoin investments to less than 5% of a person's whole portfolio.

Potential investors wishing to purchase the dip, on the other hand, should be aware of the volatility and be prepared for it in the future. Even if they invest now, when prices are low, they should expect prices to fall even further.

Again, investors are encouraged to only put in what they can afford to lose – after covering other financial objectives like emergency reserves and more traditional retirement plans.

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