Skip to main content

Source: Сointеlеgrаph

The turmoil in the cryptocurrency market began in the third week of September as most cryptocurrencies started the week on a bearish note. The total market capitalization of cryptocurrencies has fallen below $1 trillion again, with several cryptocurrencies recording double-digit drops over the past 24 hours.

The ongoing bearish turmoil has resulted in nearly half a billion cryptocurrency traders being liquidated in the last 24 hours. Coinglass data shows that 130,087 traders were liquidated for a total liquidation amount of $431.51 million. Bitcoin (BTC) leveraged traders lost $44.5 million, followed by Ether (ETH) traders with a total liquidation of $8.39 million.

Long traders have suffered a significant portion of losses on most exchanges, with an average difference between the sum of long and short liquidations being 10X.

Liquidations across exchanges Source: Coinglass

The current market turmoil is being attributed to several macroeconomic factors, including the recently released Consumer Price Index (CPI) data released on September 13, which showed that inflation has not yet cooled down. The price of BTC dropped nearly $1,000 within minutes of the release of the CPI data. Since then, the market has shown some will to move higher over the weekend, but suffered another bloodbath earlier on Monday.

The higher CPI data is expected to be followed by a Fed rate hike at the upcoming meeting scheduled for September 21st. Market experts predict that the rate hike could be the biggest in 40 years as a measure to curb soaring inflation.

According to the CME FedWatch Tool, the market has now fully factored in a Fed rate hike of at least 75 basis points and is not discounting the chances of a 100 basis point hike. A 100-point hike would be the first such move by the Fed since the early 1980s.

Related: Here’s why a 0.75% Fed rate hike could be optimistic for Bitcoin and altcoins

The recently completed Ethereum merger was also widely accused of being “buy the rumor, sell the news” when the price of ether (ETH) rose to $2,000 ahead of the merger, but has now dropped to $1,300. Post Merge.

With stocks and crypto markets experiencing a similar bearish trend, popular trader Clark was quick to point out the resemblance of current market conditions to those of the 1970s.

In his tweet, Clark noted that the market could turn bullish again by the end of the year, in November and December. Thus, the cryptocurrency market may see another bull run along with the stock market towards the end of 2022.

Source: Сointеlеgrаph

Leave a Reply