Bitcoin (BTC) started the new week lower, losing most of the gains made last week following the Fed’s interest rate cut.
At this point, BTC dropped below $89,000, drawing market attention to further declines.
Despite overall market caution, Ethereum (ETH) has remained relatively resilient and resistant to decline, holding onto its recent gains better than Bitcoin, thanks to incoming demand and low selling pressure supporting its price.
With declining liquidity and the possibility of a Bank of Japan interest rate hike considered to be putting downward pressure on Bitcoin and the market, the first support level for BTC is reported to be around $86,000.
Crypto analyst Ali Martinez, in his analysis from account X, stated, “With the break below $89,000, the first support level is $86,000. If this level is also broken, a deeper correction may occur.”
Market maker Flowdesk, analyzing the decline in Bitcoin, pointed to a significant decrease in liquidity as the reason for the drop.
Flowdesk analysts, noting the decrease in demand and liquidity following the Fed’s 25 basis point interest rate cut, believe these factors are the reason for the pullback in Bitcoin and altcoins.
Although Bitcoin and the cryptocurrency market in general experienced pullbacks, on-chain data also captured a quiet accumulation of wealth.
According to Glassnode, digital asset treasury (DAT) firms have resumed buying Bitcoin as it continues to struggle with sharp declines. Previously, the halt in DAT purchases was cited as one of the main factors in Bitcoin’s stagnation throughout the fall.
*This is not investment advice.
Source: https://en.bitcoinsistemi.com/bitcoin-starts-the-new-week-with-a-decline-so-whats-the-reason-for-the-decline-analyst-warned-about-this-level/
