Bitcoin Prices Drop Amid Macro Challenges: QCP

The cryptocurrency market has come under selling pressure again this week as headwinds from global economic factors continue to emerge. Cryptocurrencies, including Bitcoin, fell on Federal Reserve minutes, which showed the Fed may reconsider borrowing costs as signs of inflation emerge.

The total market cap of all cryptocurrencies fell to $3.37 trillion on January 9, after several sessions of 4% decline. Bitcoin’s decline to $95,200 this week fell below the crucial support level of $92,500.

Researchers at QCP Capital He said In a telegram that macroeconomic risk factors pose a challenge to the market. The trading desk noted that federal funds futures contracts based on minutes from the January 8 Federal Reserve meeting indicated smaller interest rate cuts. Federal Reserve Governor Christopher J. Waller stressed the risks of inflation.

The Federal Reserve has indicated that it will slow the pace of interest rate cuts due to rising inflation risks. Yesterday’s ADP Employment Survey also added to the overall uncertainty, showing a slowdown in private sector hiring and wage increases. This is in sharp contrast to Tuesday’s JOLTS job vacancy results, which charted a stronger job market.

QCP Capital on the cryptocurrency decline

Bitcoin is likely to consolidate amid institutional demand

QCP analysts expect Bitcoin price to remain between $92,000 and $95,000 in the short term. However, they laid out downside risks, adding that if BTC breaks the $90,000 mark, it will head towards the $92,000 figure.

Exacerbating the bearish outlook, the US Department of Justice (DOJ) approved the sale of $6.5 billion worth of Bitcoins from Silk Road a few days ago. Donald Trump’s inaugurationwhich confused cryptocurrency enthusiasts. Furthermore, Trump promised to stop selling Bitcoin from government stocks and create a national Bitcoin fund, so the timing of the DOJ’s decision has left some scratching their heads.

Yet, prolonged overall downward pressure may be mitigated by continued institutional interest in Bitcoin’s proposals. Other behemoths, including MicroStrategy and Wall Street’s first spot Bitcoin exchange-traded products (ETPs), are maintaining demand.

The trillion-dollar asset management company, Fidelity, noted that the adoption of Bitcoin by countries, companies and governments will rise in 2025. Such developments could add long-term support to the price of Bitcoin and improve the overall situation. Cryptocurrency market.

Macroeconomic conditions remain volatile, as they are Bitcoin And the crypto market. However, prospects for a recovery in sentiment in the near term are hampered by persistent inflation concerns and continued short-term selling by governments or central authorities.