Bitcoin Returns Above $25K Amid Uncertain Fundamental Factors
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Bitcoin's price fell below $25,000 for the first time since the middle of March 2023. The drop followed a hawkish Fed announcement amid a turbulent week for cryptocurrencies. Before the Fed's announcement, the crypto market was confronted with regulatory scrutiny for two of the biggest crypto exchanges, Coinbase and Binance.
In a video uploaded on YouTube, crypto analyst Cody Buffinton explained it took only 15 minutes for Bitcoin's price to drop from $25,867 to $24,819, reflecting a 4% loss. Bitcoin's price revolved around $26,000 before the drop, as crypto users attempted to resist the FUD (Fear, Uncertainty, and Doubt) caused by the regulatory clampdown of two of its own.
The increase in macroeconomic uncertainty resulting from the Fed's report opens the way for the price collapse. The Fed's Chair, Jerome Powell, told the public that it paused interest rate hikes. That pause followed a 15- month-long campaign of a consistent rate increase to curb rising inflation.
In his statement, Powell added the pause was temporary, hinting that there could be more interest rate hikes in the future. The uncertainty generated by Powell's comments preceded the sharp drop that pushed Bitcoin slightly below the $25,000 psychological level.
Despite the drop, the $25,000 price level proves its strength, as the price has returned above it. At the time of writing, Bitcoin's price traded at $25,461, with no significant momentum on either side of the trend. The current state of the Bitcoin market presents a near-equilibrium outlook with no clear direction.
From a yearly perspective, the Bitcoin market remains bullish, with a 54% profit from its opening price in 2023. The current market condition presents a conflict between fundamental factors that may affect Bitcoin's price. Users expect a bullish trend months before the next Bitcoin halving. However, regulatory and macroeconomic factors seem to suggest otherwise.
$BTC
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