Bitcoin (BTC) is priced at $50,193.32 after crashing 17.7% over the past 24 hours, according to CoinGecko. The price went even further down but bounced back near the $49,000 price level, and Bitfinex analysts highlighted that this zone might be a short-term support.
“We expect short-term support to be established around the 48,900 region. If there is no bullish momentum, this region may be retested, with the macroeconomic environment determining further price action,” added the analysts.
The crypto sell-off is macro-driven. As reported by Crypto Briefing, the trigger for this massive correction appears to be the Bank of Japan’s unexpected interest rate hike last week, which sent the yen soaring and Japanese stocks tumbling. As a result, the Nikkei index has fallen roughly 15% over three sessions and is now 20% below its mid-July peak.
Moreover, Bitfinex analysts also point out the disappointing US employment report and a rise in unemployment as other factors behind the current crash. “Additionally, the Sahm’s Rule, which has accurately predicted past recessions, has come into play in the US, heightening fears of a recession.”
Sapphire
Ben El-Baz, managing director of HashKey, also underscored the rising geopolitical tensions in the Middle East as another factor that might have contributed to the current crash. “The escalating conflict between Iran and Israel has the potential to fully erupt. The market, worried about the increasing risks in the Middle East, has turned to safe havens.”
Furthermore, the price dips caused by the above-mentioned factors triggered a series of stop-loss thresholds for Ethereum (ETH) leveraged positions, which added pressure to ETH and contributed to further downside.