Bitcoin (BTC), Ethereum (ETH), and Binance Coin (BNB) led the cryptocurrency markets with heavy losses over the past 24 hours following February surpluses. The global cryptocurrency market capitalization fell about 7.7% to about $2.5 trillion during the early trading session in London on Tuesday, according to data provided by Coinmarketcap, backed by Coingecko and Binance. I did.
As cryptocurrency volatility rises, more than $526 million has been liquidated in the last 24 hours, with over $442 million of that coming from long-term traders.
On the daily chart of Bitcoin’s USD derivatives, the instrument has already shown short-term weakness after falling below the support range between $64,500 and $65,266 over the past 24 hours. As a result, the next few weeks will be choppy for Bitcoin and the overall cryptocurrency market.
Main reasons why the cryptocurrency market is down today
Risk-off before FOMC
On Wednesday, the U.S. Federal Reserve is scheduled to release its highly anticipated benchmark interest rates after the last two rounds of Consumer Price Index (CPI) data showed uneasy inflation. Economists predict the Fed will keep interest rates at 5.50% but will not lower them.
Nonetheless, there is a lot of uncertainty looming as Federal Reserve members lack confidence in raising interest rates. As a result, cryptocurrency traders have been de-risking traders to avoid forced liquidation.
Healthy market before halving
After Bitcoin and cryptocurrency markets recorded notable gains over the past few months, driven by the approval of spot Bitcoin exchange-traded funds (ETFs) in the US, a cooling-off period was expected to ensure a healthy market correction.
According to renowned cryptocurrency analyst Ali Martinez, the Bitcoin price is likely to find a solid support level around $61,100 in the coming weeks. In the event of continued selling, the cryptocurrency analyst believes that the support range between $51,530 and $56,685 will remain.
Derisking Altcoins and Meme Coins
The altcoin market and meme coin industry have recently recorded significant gains. The notable rise in new meme coins meant inevitable profit-taking, which led to a wider cryptocurrency sell-off.