Over the past few hours, bitcoin price deviated from a major support level and fell below $19,000. Transaction history reveals that several addresses have bought Bitcoin for more than $20,000. These market players will soon liquidate their holdings to prevent further losses, which would lead to a drop towards $16,000.
Inflation Warnings Affect Bitcoin Price
Due to the main inflation concerns and interest rate hikes pointed out by central banks, particularly the US Federal Reserve, BTC lost nearly half of its value over the previous month.
The Bitcoin market valuation has fallen from $1.27 trillion in November 2021 to less than $366 billion today.
Jerome Powell, Federal Reserve Chairman, reaffirmed the Fed’s commitment to raise interest rates in order to bring down inflation. He stated during the European Central Bank meeting that the inflation challenge was more concerned about the possibility that higher interest rates would cause the US economy to enter a recession.
“Is there a risk that we are going too far? Certainly, there is a risk,” Powell said. “The biggest mistake we would make — to put it this way — would be to fail to restore price stability.”
BTC/USD falls below $20k. Source: TradingView
Powell argued that the Fed needs to raise interest rates quickly because a gradual increase may give consumers the impression that the increase in commodity prices will not go away. He said the rate increases may be reduced before next year.
After Powell’s comments, US stock market futures fell, with S&P 500 futures down 1.59% and the high-tech Nasdaq 100 losing 1.9%. Asian markets fell, with the Dow Asia and Japan’s Nikkei 225 both down 1.54%.
The data indicates that whales are waiting
on the chain Data on CryptoQuant It indicates that most traders are waiting for the next big price drop. However, the price forecast appears to be a short-term opportunity.
Cross-chain data also indicates that big whales are waiting for a good opportunity to accumulate cryptocurrency, not just for small and medium traders. The data shows that, interestingly, whale holdings of bitcoin are not growing right now.
And this unequivocally shows that whales are waiting for a better opportunity. Whale holdings between 100 and 1,000 and between 1,000 and 10,000 Bitcoins currently show a flat line.
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Featured Image from Pixabay and Chart from tradingview.com